Cocoa futures surged by up to 2.7% to reach a new intraday high of $10,760 per ton in New York, signaling continued pressure on global supplies.

New York prices have climbed for seven consecutive sessions, marking the longest upward trend since early February. Adverse weather conditions and crop diseases have severely impacted harvests in the key West African growing region.

Bloomberg reported on Monday that cocoa arrivals at ports in the top producer, Ivory Coast, have dropped by 30% compared to the previous year, totaling 1.31 million tons so far this season.

The cocoa market's volatility has been exacerbated by increasing margin calls and declining open interest, resulting in more pronounced market fluctuations.

Analysts from Citi Research suggested in a note on Friday that New York futures could potentially reach $12,500 per ton within the next three months. However, they also cautioned that elevated prices pose a risk of bankruptcies over the next six to 12 months.

Cliff Shelton, an economist at AgAmerica, a lender to the agriculture industry, mentioned that while processing plants being priced out of the market might alleviate some demand-related issues, uncertainties persist regarding the supply outlook. Weather-related challenges and crop diseases continue to hinder production.

“There’s undoubtedly room for futures prices to push even higher, especially for near-expiring contracts,” Shelton said. “Traders are jumping at opportunities to purchase at spot rates or near-term futures to have more accessibility to supply in hopes of fulfilling commitments to chocolate firms. With early reports of production being lower than expected, the upward price movement will likely continue.”