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- Chocolate may have just become even more of a luxury item with cocoa futures prices surging to a 12-year high.
- A mix of heavy rainfall and a black pod disease in West Africa have crunched supply, driving up the price of cocoa.
- Orange juice prices prices also hit a record high this week - suggesting food inflation risks in the US remain elevated.
Inflation may be cooling fast, but some food prices are hitting highs not seen in years.
Just days after orange juice prices climbed to a record, cocoa futures have surged to their priciest in 12 years.
Cocoa futures in the US jumped to their highest level since 2011, Barchart data shows, climbing as much as 7.4% this month 5.25% to $3,602.
Prices of the chocolate bean are rallying amid a supply crunch caused by heavy rainfall and the spread of a black pod disease West Africa, which leads to the rotting of cocoa pods, according to Bloomberg.
Orange juice prices have also surged this month due to supply disruptions due to citrus greening - a crop disease - in Florida and Brazil, some of the world's largest juice exporters. With prices of the popular drink on the rise, consumption has dropped to the lowest level in at least five years, per Bloomberg.
Cocoa and orange juice prices have surged even as US inflation cools from the 40-year highs hit last year, after the Federal Reserve raised interest rates aggressively. The annual pace of consumer-price increases dropped to 3% in June from 9% a year earlier, with the central bank hiking benchmark rates by 525 basis since early 2022.
Finance guru Larry McDonald recently weighed in on commodity inflation, pointing out the rise in prices of other foods including wheat and soybeans. He took that as an opportunity to mock those complaining the Fed has been too restrictive in its monetary policy, in a Wednesday tweet.