XLP - Is My Candy Bar Getting Smaller? Yes A Chocolate Crisis Means Smaller Pricier Hershey's | Benzinga
After hitting a fresh record high on Monday, cocoa prices have slumped 13% — a sharp fall in just three days. But experts say the market remains in critical short supply, which is why Valentine’s Day chocolates were so expensive.
Meanwhile, hedge funds continue to build up long positions.
Despite the slump over the past three days, the U.S. cocoa futures price has jumped 43% to $5,999 a tonne since the start of the year. Four days ago it hit a fresh record high of $6,929.
This is particularly hard on companies such as Hershey Co (NYSE:HSY). The company reported earlier this month that it now expects flat earnings for 2024 due to higher raw materials costs.
“Historic cocoa prices are expected to limit earnings growth this year,” said Hershey CEO Michele Buck.
Shares in Hershey have fallen 8% to $186.25 since reporting its quarterly earnings and 2024 outlook on February 8.
Also Read: Choccy-Horror Show: Hedge Funds Pile In As Cocoa Soars To Record ...