Provides in depth analysis into the commodity markets as it concerns Nigerian agri businesses. This weekly update is insightful and thoughtful

1. Market News
Cocoa Harvest to Increase to 75,000 tonnes in 2018
Amidst significant weather challenges to the harvest of cocoa in Ivory Coast, the largest cocoa
producer in the world, the Cocoa Association of Nigeria hinted that the country’s mid crop
harvest was poised to increase by 15% yoy. The association president, Sayina Riman highlighted
the favourable weather and mentioned that the rains have been particularly good for cocoa in the
2017/2018 season. He further indicated that the total tonnage expected is to rise by 15,000 tonnes
to reach 75,000 tonnes from the previous year. This is amidst significant challenges to harvest in
Cote d’Ivoire that have continued to make cocoa prices move northwards since the harvests
began this year.
Commodity Price Updates for 16 April- 20 April, 2018
Week Commodity Average ($) Change (%)
AprW3 Cocoa 2715.631
7.40
AprW3 Sugar 11.982 -2.5
1
: ICCO Daily Cocoa Prices
2
: ISO Daily Sugar Prices
Cocoa Prices Continue Upward Trend
The prices of cocoa beans for the week ended continue to remain bullish as the futures and spot
markets continue to price in the prospects of reduced harvest from the West African sub region.
News of heavy rains and its effects on the mid season crop harvest continue to influence pricing
in the international markets. The prices of cocoa beans reached it year highs on the ICCO price
index on Wednesday as grinding data from Europe fed into the markets as the total grindings for
the January-March period revealed a 5.5% increase yoy as grindings of processors in the EU15
ground 358,432 tonnes of cocoa beans in Q1’18. This was followed by grinding data for Asia
and North America which rose by 7.2% and -1.1% respectively. Generally, the prices of cocoa,
as shown in chart 1, have risen by 103.51% since the beginning of the year, making it the most
bullish commodity thus far.
Sugar Tumbles, Sinks Deeper
The sugar prices for the week ended, unlike the cocoa beans have taken a huge dip and it
dropped by 2.5% to reach 11.96 cts/ Ibs. The sugar prices have continuously fallen in 2018
amidst sugar surpluses and further speculation of increased production in India and EU. The
sugar prices reached its lowest price for the year on the ISO daily price index, reaching 11.85 cts
and thus shedding almost 28.52% of its value since the beginning of the year. Speculators expect
Researched and Designed
By
Ogunbiyi Yusuf
University of Ibadan
Agri-Intelligence Weekly
April 22, 2018|Issue 4

2. a further reduction in prices as the surpluses persist but expect the surplus to ease off as the next
season comes to a conclusion. Already, planting has started in EU and an expectation of reduced
plantings is poised to reduce surplus to about 2 million tonnes. The 2018/2019 milling season has
also started in Brazil and analysts are also estimating an average of 41% conversion to sugar
which is expected to also reduce world stocks. The price trend for sugar since the beginning of
2018 is shown in chart 2.
Chart 1: Cocoa Price Trends (2018)
Chart 2:Sugar Price Trend (2018)
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Cocoa
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Sugar
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