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Commodity and Currency



April proved to be a highly significant month for the Cocoa Market. The end of the main crop was followed by positive and recovering grind figures (consumption) in the US and Europe. This recovery was hardly surprising considering the reductions seen during 2009, and although the figures are in positive territory they are still some way behind highs previously seen. So the underlying forecast is that there will be a reasonably significant deficit between the crop size and demand during the 010-2011 year. This helped fuel a serious bull market run, which led to a steady rise in the market culminating in 32 year highs – so the market hit levels last seen in 1978. Basically due to the balance in the fundamentals becoming clearer, leads me to believe that these high levels are here to stay and that we should expect the market to range between 2100 and 2500 for the foreseeable future.

Obviously this impacts on Chocolate prices and in this Newsletter we now can confirm the levels of increase for the period 1st July – 31st December 2010.


The late spring has contributed to a continuing strengthening in Milk prices. Demand is high and we are seeing a similar pattern to that seen in 2007 and expect Milk prices to continue to rise in the coming weeks. The impact of this on Milk & White Chocolate prices will be felt in pricing for the first half 2011.


Massive volatility in currency markets largely due to the Greek situation has lead to the Euro weakening significantly and so Sterling is enjoying it's day in the sun! We are far from out of the woods despite a bail out plan being agreed for Greece, so it is a question of ‘watch this space'. The UK election today will at least remove some uncertainty and a clear result could push Sterling even higher than now – touching Euros1.18 = £1.

Tony Mycock
6th May 2010

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HB Ingredients
Cocoa House, 22 Bell Lane,Bellbrook Industrial Estate,
Uckfield East Sussex. TN22 1QL.
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