1. Introduction to Commodities
  2. Commodities: Cocoa
  3. Commodities: Coffee
  4. Commodities: Copper
  5. Commodities: Corn
  6. Commodities: Cotton
  7. Commodities: Crude Oil
  8. Commodities: Feeder Cattle
  9. Commodities: Gold
  10. Commodities: Heating Oil
  11. Commodities: Live Cattle
  12. Commodities: Lumber
  13. Commodities: Natural Gas
  14. Commodities: Oats
  15. Commodities: Orange Juice
  16. Commodities: Platinum
  17. Commodities: Rough Rice
  18. Commodities: Silver
  19. Commodities: Soybeans and Soybean Oil
  20. Commodities: Sugar
  21. Commodities: Wheat
  22. Understanding Commodities Trading

Cocoa is a member of the “softs” commodity group: those that are grown, rather than mined. As a commodity, cocoa refers to cocoa beans, which are the dried seeds of the Theobroma tree – from the Greek theos, meaning “god” and broma, meaning “food.” Once used as a common currency, cocoa today is used primarily in the production of chocolate and other products, such as cocoa butter.

Contract Specifications

Ticker Symbol

CJ (CME Globex)

CC (ICE)

Contract Size

10 metric tons

Contract Months

H, K, N, U, Z

Trading Hours

CME Globex: Sunday – Friday, 6:00 p.m. – 5:00 p.m. (there’s an hour break from 5:00 to 6:00 p.m. each day)

ICE: Monday – Friday, 4:45 a.m. – 1:30 p.m.

Last Trading Day

One business day prior to last notice day (last notice day is 10 business days prior to the last business day of the delivery month)

Price Quote

U.S. dollars and cents per ton

Tick Size

$1.00 per ton ($10 per contract)

Production        

The cocoa tree needs a specific climate to thrive: It’s a shade-loving tree native to the rainforest understory that grows best in regions that are 20 degrees north or south of the Equator. Cocoa trees take about five years to reach maturity and bear fruit, at which time about 20 pods might be ready for harvest (in general, 10 pods produce 2.2 pounds of cocoa). Worldwide, the top three producers are Cote d’Ivoire, Ghana and Indonesia. While West Africa accounts for about 70% of global market share, Latin America is a key player, thanks to Brazil, Ecuador, Mexico, Peru, Dominican Republic, Columbia, Venezuela and Guatemala.

Price Drivers

The price of cocoa is influenced by several factors, any of which can trigger significant price swings in a relatively short time period. Key price drivers include:

  • weather conditions
  • geopolitical tensions
  • climate shifts (which can affect conditions for healthy growth)
  • labor (cocoa relies heavily on cheap labor and new labor regulations can impact price)

 

 


Commodities: Coffee
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