This week, cocoa prices fell by 28%, falling to $6990 per ton on Friday, continuing the rollback from record levels. This was reported by Bloomberg, according to UNN.
Details
Cocoa fell by 7.6% to $6990 per metric ton, but then recovered its losses and traded 0.9% higher. The price is still on track for a 28% weekly drop, the biggest drop since 1959.
Just two weeks ago, the most active contract hit a record high of nearly $12,000 per tonne as the industry struggled to cope with the effects of a severe supply shortage. But this week, futures fell to $6,990 - about 40% below the all-time high - and were accompanied by extreme price swings after an outflow of traders drained liquidity.
The pullback marked a sharp reversal for cocoa, which has become more expensive than copper. Prices skyrocketed as a poor harvest in West Africa led to the world facing a third year of cocoa shortages, which stressed buyers and pushed up the price of chocolate. But the frenzy has also made it more expensive for traders to hold their positions, forcing many of them to leave the market.
Recall
Last year, the world's key cocoa bean producers Ghana and Côte d'Ivoire warned European buyers that they should be prepared to pay more for cocoa and chocolate, as the products will now be grown in accordance with EU requirements.