By Leslie Josephs
NEW YORK--Cocoa processing in North America hit a record high
level in the third quarter, more than triple market expectations of
lackluster growth amid high prices.
In the July-September period, North American factories processed
138,027 metric tons of cocoa beans, according to data from the
National Confectioners Association. It was the largest amount
processed since 2000, the oldest data available on the trade
group's website.
"The grind is stronger than forecast, and the anticipated
degradation of consumption due to price hikes is slow to
materialize," said Kip Walk, head of sustainability at processor
Blommer Chocolate Co., which was included in the NCA's survey.
In July, Hershey Co. (HSY) and a unit of Mars Inc. raised prices
for U.S. chocolate products to offset rising costs.
Cocoa prices have climbed this year due to strong demand and
concerns that the Ebola outbreak in West Africa, the epicenter of
the disease, would hinder the exportation of cocoa beans. West
Africa is the source of more than two-thirds of the world's supply
of cocoa.
Cocoa for December on ICE Futures U.S., which settled before the
data were released, fell 2.1% to $3,086 a ton. Analysts had
predicted the grindings would be little changed from the previous
year, with estimates ranging from a 1% decrease to a 1%
increase.
The quarterly grindings, or tonnage, of cocoa beans processed
into cocoa powder and other products used in confections are
considered a barometer for chocolate demand.
Data were collected from 17 plants in Canada, the U.S. and
Mexico, the same number as the previous year.
Companies that supplied data for the North American grindings
report included Archer Daniels Midland Co. (ADM), Hershey, Blommer
Chocolate Co., Mars Inc., Cargill Inc., Nestle SA (NESN.VX), Barry
Callebaut AG (BARN.EB), Ecom Agroindustrial Corp., World's Finest
Chocolate Inc. and Ghirardelli Chocolate Co.
Write to Leslie Josephs at
leslie.josephs@wsj.com<mailto:alexandra.wexler@wsj.com>
Subscribe to WSJ: http://online.wsj.com?mod=djnwires