There is a surprise outperformer in the commodity pack this year. And no it’s not one of the metals or crude oil.
Cocoa prices on the Intercontinental Exchange in the U.S., a global benchmark contract, have advanced 49 percent so far in 2018 on rising fears that a glut could turn into a deficit this season.
That’s because of accelerating demand combined with supply concerns on less plantation acreage and investment. Also, dry weather has affected the bean quality in West Africa, the world’s largest producing region, according to Bloomberg.
ICE cocoa returns have beaten other agriculture commodities as well.
The next best performer is lumber on the Chicago Mercantile Exchange lumber, with 30 percent gains.
In comparison, the London Metal Exchange zinc corrected by 9.4 percent this year. Nickel, the best among base metals, returned 8 percent, while aluminium and steel prices fell 0.1 percent and 4.2 percent, respectively.
From the energy basket, New York Mercantile Exchange gasoline rose 16.2 percent.
Sugar is the worst performer with a loss of over 23 percent.