January 24th, 2011
Econintersect: Cocoa prices shot higher on Monday after the internationally recognized leader of Ivory Coast, the world's largest producer of cocoa beans, called for a one-month ban on exports. The political turbulence added to pressures on the retail price of chocolate treats. Ivory Coast produces more than 70% of the world's cocoa. Follow up:
Follow up:Cocoa futures on the Liffe commodities' exchange in London were up 3.9 percent Monday to 2,223 pounds per ton, the highest since early August, after trading as high as 2,290. Cocoa traded as low as 1,770 pounds in November. Some had expected as much as a 10% jump in cocoa prices today.
Prices have risen 12 percent since Jan. 5, according to a research note from Commerzbank.
The export ban was proposed by Alassane Ouattara as a move to choke off funding for the incumbent, Laurent Gbagbo, who has refused to concede defeat.
It is unclear whether the ban will be heeded by cocoa growers or how it will be enforced.
Marcia Mogelonsky, U.S.-based global food analyst for Mintel, said retail chocolate prices are destined to rise even if the political situation in Ivory Coast stabilizes in the next few weeks.