New one-year highs for cocoa were reached in New York recently, with the price up further to US$3,400/tonne, as Presidential hopeful Alassane Ouattara’s month-long ban on exports took a toll on the market.
As Macquarie reported recently, actual supplies have not been affected too much, given that most of Côte d’Ivoire main crop had already been exported before the ban.
“Cocoa arrivals from Côte d’Ivoire reached 895,000 tonnes by the end of January, and we suspect any remaining volumes will slip through illegally via Ghana,” said Macquarie.
“However, should the ban be extended and affect the mid-crop sales too, then the supply risks become more real, as we believe that the industry will have less coverage by then.”
As such, Macquarie still sees price risks skewed to the upside in the short term, as financial liquidity problems are halting trade volumes, and there remains much political unrest.
