JP Morgan AM: Cocoa prices have shot higher in 2024

JP Morgan AM: Cocoa prices have shot higher in 2024

2 april 2024

Grondstoffen Inflatie
Chocolade fair trade (AlexanderStein, Pixabay).jpg

Cocoa prices have surged recently, with wholesale prices breaching $10,000 per metric tonne, up from around $4,000 just three months ago. Unfortunately, these moves are better explained by structural mismatches in supply and demand than the seasonal popularity of chocolate eggs.

On the supply side, years of underinvestment in cocoa farming has led to cocoa plantations that are more vulnerable to climate change and disease, while the recent surge in shipping costs has added to short-term price pressures. On the demand side, United Nations data shows that global cocoa consumption per capita has increased by 40% since 2000, with emerging economies seeing the strongest growth as income levels improve. While cocoa prices are just one example, this combination of underinvestment, geopolitical tensions, environmental change and shifting consumption patterns are all likely contributors to higher inflation volatility over the medium term.

02042024 - JP Morgan AM

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