LIVE MARKETS-Soaring cocoa costs add a bittersweet note to Valentines

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SOARING COCOA COSTS ADD A BITTERSWEET NOTE TO VALENTINES

As Valentine's Day takes the spotlight this Friday, one of the most popular gifts, chocolate, might put a bit of a dent in your wallet.

The cost of this beloved treat has been on the rise. Cocoa, a key ingredient, emerged as the top-performing major commodity in 2024, with prices nearly tripling.

London cocoa LCCc2 prices soared to an unprecedented high of nearly 10,000 pounds per ton, primarily due to significant crop challenges and unfavorable weather conditions in the Ivory Coast and Ghana, which are responsible for about 60% of the world's cocoa production.

The stocks-to-grindings ratio, which measures end-of-season cocoa inventory relative to the amount processed in the current year, remains near multi-decade lows, according to Adam Turnquist, chief technical strategist for LPL Financial.

"Brace yourself for some sticker shock when picking out chocolate. Higher prices have dampened demand. Momentum has slowed as prices entered a consolidation phase," he said.

So, while chocolate remains a symbol of affection, it might come with a premium price tag this year.

(Pranav Kashyap)

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