Cocoa extended its biggest price hike in five years, despite rising tension in Ivory Coast the world’s largest cocoa grower.
The beans jumped as much as 4.4 percent in London as Ivory Coast’s Special forces are trying to suppress a growing rebellion by sections of the Army.
Reported shootings at the main army barracks in Abidjan, the commercial capital, and the country’s second-biggest city of Bouake have heightened tensions
There has been a slight pick-up in the price in the last few days and that may actually reflect people getting a bit nervous, Edward George, head of research at Ecobank Transnational Inc., Bouake is one of the centers of the cocoa trade so obviously people are worried.
The unrest was sparked by an announcement from President Alassane Ouattara on Thursday that the government reached a compromise with troops who revolted earlier this year over unpaid bonuses.
The dangerous thing is, there is a very big speculative short in New York and the situation in Ivory Coast � that’s a catalyst in the market to trigger short-covering, Jonathan Parkman, the co-head of agriculture at Marex in London, said. It’s a political worry. Do I actually think it will restrict cocoa supplies? I seriously doubt that.
Source: Voice of Nigeria