Rabobank Sees Cocoa Deficit at 89,000 Metric Tons in 2012-13
Global cocoa demand will outpace supplies for a second consecutive year in the season starting in October and prices are likely to move higher in the third and fourth quarters, according to Rabobank International.
A shortage of 89,000 metric tons is forecast for the 2012-13 season, the bank said in a monthly report e-mailed today. That would follow a deficit of 33,000 tons in the current 2011-12 season. Production in top grower Ivory Coast is likely to be “lower than optimal” due to prices in the international market which have declined, the bank said.
“The cocoa markets will move higher in the third and fourth quarters due to a tighter fundamental outlook and concerns about supply from the Ivory Coast, as a result of a new government cocoa program,” Keith Flury, an analyst at the bank in London, wrote in the report.
Ivory Coast is making changes to its cocoa industry which include a plan to sell 70 percent of the 2012-13 crop before the season starts. The so-called forward sales started on Jan. 31. The reforms also include a price guarantee for farmers.
Global cocoa production is forecast to total 4.1 million tons, while bean processing will climb 3.1 percent to 4.2 million tons driven by demand in Asia, the bank estimates.
Cocoa will average 1,525 pounds ($2,408) a ton in London in the second quarter, rising to 1,600 pounds in the third and 1,700 pounds in the fourth, according to the report.
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