Your Easter eggs later this month may be pricier than ever thanks to a run on cocoa contracts in recent weeks. The chocolate ingredient is in short supply due to difficult growing conditions in West Africa, and a rush of financial manoeuvring by major players has forced the price up further in recent weeks.
In New York, cocoa prices rose close to $7,000 (£5,489) a tonne at the start of this week, a new record. That is a two-thirds increase since the start of the year. The initial driver was poor weather conditions in Cote d’Ivoire and Ghana, the biggest production sources, with heavy rain at first last year and more recently dry conditions limiting the current crop.
In reaction to this weaker supply, major chocolate companies waded into the futures market with an eye to buying up more cocoa and covering short positions. These shorts are held to hedge against exposure to spot prices.