The Cocoa Short Squeeze: Why Cocoa is Trading like Meme Stock
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Episode Description
Full episode: https://youtu.be/4t4YkHSTZbw
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Brief Summary
Cocoa prices surged due to production decline from disease, impacting chocolate products and pricing.
Key points
- Cocoa Prices Skyrocket. Cocoa prices have surged from $2,000 to $10,000 a ton due to production issues.
- Production Decline Due to Disease. A 50% decline in cocoa production has been reported, impacting the market significantly.
- Chocolate Bar Changes Ahead. Chocolate companies may reduce bar sizes and raise prices due to cocoa shortages.
Transcript
this is the big news in the commodity markets right now is this parabolic spike in Coco prices Coco's moved in price from about 2,000 bucks a ton which is where it normally trades at to $10,000 a ton so here's all the Coco production 73% of it's in Africa mostly in Ghana and Ivory Coast Coco is grown from the cacao tree when you eat a Hershey's bar for example 11% of that bar is ground up cocoa powder so in Q4 of last year ELO spiked like crazy and that caused a lot of rainfall to hit the west coast of Africa and as a result result this fungus was spread in cocoa trees there's a fungus called blackp disease so now if you look at the Coco production out of Ghana you can see that
we've seen them 50% rough decline in Cocoa production so when that happened everyone started to Corner the market and then all the short sellers got squeezed and it caused this big parabolic jump in price chocolate companies they're talking about cutting the size of their chocolate bars raising prices and starting to use other ingredients so you'll start to see that happen in the shelves in the next couple of months
