Seventy percent of cocoa comes from West Africa, mostly Ivory Coast and Ghana. The supply can swing way up or down depending on political instability and the weather there. “At times coca prices’ annualized volatility can be as much as 20 to 25 percent,” said James Butterfill, head of research and investments with ETF Securities.
This year, favorable weather in Ivory Coast is contributing to a surplus, and prices have fallen steeply. That forced the government to lower the price it guarantees cocoa farmers. Read more