Soaring cocoa prices as supply fails to keep pace with demand
Sunday, October 25, 2009
There is an excellent article in the Times today about the surge in the world price of cocoa. Cocoa prices have hit a 30-year high as poor weather threatens to drive the price of chocolate up again for Western consumers. Cocoa has reached $3,412 a tonne in New York as concerns deepened about demand outstripping supply for the first time since 1968. This is a really good article to use to consolidate students’ understanding of how shifts in supply and demand can lead to price volatility. And also the importance of price elasticity of demand and supply in shaping price changes.
“The surge in price also indicates that cocoa is increasingly being used for financial investment rather than merely sold to industry”
* What factors are limiting cocoa supply?
* Why is demand from western economies rising - even though many are still in recession?
* Will cocoa farmersd necessarily gain from higher world prices?
Rated: 
(4/5), based on 1 review
Page 1 of 1 pages
Most Popular Topic Tags on the Economics Blog
recession, demand, economics, unemployment, prices, price, inflation, investment, costs, trade, profit, employment, debt, supply, downturn, euro, gdp, confidence, competition, risk, china, capacity, exports, production, incentives, oil, expectations, manufacturing, sterling, housing, pay, food, profits, banks, tutor2u, globalisation, mortgage, property, revision, retailers, slowdown, borrowing, usa, innovation, emissions, dollar, deflation, airlines, supermarkets, entrepreneur, monopsony, efficiency, productivity, google, elasticity, moodle, wealth, aqa, keynes, protectionism, welfare, consumption, externalities, saving, opec, economist, inequality, strategy, depression, competitiveness, economic cycle, tim harford, stocks, depreciation, jobs, monopoly, infrastructure, carbon, credit crunch, poverty, cars, eu, bank of england, vle, environmental, carbon trading, spare capacity, budget deficit, environment, subsidy, market failure, wages, regulation, management, evaluation, output gap, losses, behavioural, government failure, steel, climate change, construction, macroeconomics, imports, oligopoly, japan, bbc, skills, cpi, commodities, farming, newsnight, paul mason, intervention, fiscal stimulus, multiplier effect, single market, currencies, population, stagflation, contestable, itunes, lse, agflation, minimum wage, interest rates, choices, aviation, amazon, quantitative easing, germany, taxes, uk economy, monetary policy, cartel, survey, nationalisation, india, brazil, rpi, pricing, dan ariely, opportunity cost, apple, pollution, oecd, rationality, keynes society, rsa, relative poverty, iphone, shipping, capital, merger, currency, imf, balance of payments, yuan, tragedy of the commons, price discrimination, current account, redundancies, economies of scale, london, savings, facebook, stakeholders, shareholder, behavioural economics, mpc, supply chain, liquidity, takeover, barriers to entry, reputation, income elasticity, poverty trap, microsoft, hamish mcrae, human capital, subsidies, discrimination, roger bootle, federal reserve, duopoly, robert peston, immigration, suppliers, us economy, gini coefficient, quiz, collapse, coffee, obama, pensions, development, consumer surplus, national debt, crowding out, etonomics, crude oil, scarcity, eurozone, labour market, ecb, petrol, taxation, tesco, free, brand, smoking, budget, paradox of thrift, cost of living, transport, labour mobility, liquidity trap, global, speculation, starbucks, recovery, iceland, allocative efficiency, behaviour, david smith, surplus, shareholders, waste, ireland, happiness, growth, information failure, creative destruction, open source, vat, cost benefit analysis, trade deficit, tariffs, northern rock, edinburgh, comparative advantage, ownership, scrappage, ocr economics, robert frank, aggregate demand, diane coyle, freight, kaletsky, royal economic society, eton college, exploitation, utility, fishing, labour force survey, government borrowing, edexcel economics, leverage, sony, marginal cost, information, tax, paul krugman, discounting, animal spirits, peter day, contestable market, anchoring, nissan, zimbabwe, savings ratio, wiki, needs, european union, internet, public sector, evan davis, public goods, price war, heathrow, hotels, energy, contestability, standard of living, twitter, wants, hbos, stephanie flanders, blog, migrants, poland, consumer welfare, aqa economics, devaluation, spain, pubs, milk, foreign exchange, external shocks, eu enlargement, movies, advertising, indirect tax, forecast, enlargement, bond, mervyn king, income elasticity of demand, ebea, property rights, blogging, house prices, copper, accelerator, edmund conway, deforestation, hot money, jim o'neill, ucas, bonds, trend growth, libor, elasticity of supply, carbon tax, income, diesel, income tax, jobless, accelerator effect, bric economies, guardian, youth unemployment, law of unintended consequences, google wave, fixed costs, deficit, john kay, sub-prime, global economy, exchange rates, economic efficiency, biofuel, vacancies, research, renewable, companies, profit margin, price capping, joint venture, price mechanism, martin wolf, training, startups, natural monopoly, world bank, competition commission, gilts, geoff riley, fairness, producer surplus, immobility, coal, congestion, social costs, will king, sentiment, greece, redundancy, ageing population, disposable income, equity, corus, base rate, walmart, tickets, collusion, dynamic efficiency, obesity, social entrepreneur, oil prices, fair trade, real income, res, binge drinking, philip allan, russia, low pay, vehicles, broadband, cash, price fixing, king of shaves, hysteresis, tata, supply-side, tariff, income distribution, compound interest, contestable markets, positional goods, government spending, eastern europe, internet explorer, economax, repossession, general motors, sustainability, ftse, age structure, frictional, satisficing, students, green shoots, logic of life, pay floor, disincentives, yahoo, blackberry, negative externalities, oft, aldi, resources, gillette, liberalisation, migration, economics revision, healthcare, asda, financial times, fiscal drag, ryanair, wheat, market structure, cadbury, credit, winners curse, apprenticeships, market power, hidden unemployment, demography, cyclical, british airways, deindustrialisation, renewable energy, optimal currency area, sovereign debt, credit cards, declan curry, nokia, decoupling, markets, anti-trust, public good, rory cellan-jones, diseconomies of scale, economic welfare, tax burden, undercover economist, child poverty, retailing, pension, the economist, barclays, schumpeter, landfill, enterprise, brics, redistribution, floating exchange rate, gold, veblen goods, unintended consequences, vertical integration, structural, reserve currency, single currency, football, job losses, nairu, costa, monetary policy committee, nhs, deleveraging, green revolution, drugs, nelson thornes, scotland, collaboration, hyperinflation, automatic stabilisers, real gdp, monopoly power, podcast, o2, motor industry, pay cuts, labour supply, ocr as economics,All tags
ECONOMICS TEACHER RESOURCE NEWSLETTER
Join over 4,000 other Economics Teachers in the UK and around the world who receive the tutor2u Economics Resource Email newsletter. Get special offers, first news of latest resources, teaching ideas, conferences and workshops.
Recent Threads on the Economics Teacher Discussion Forums:
Posts in: General Economics Teaching
Need help. - Economic Growth
Economies of scale presentation A2
Economic development
International Competitiveness
Keynesian Aggregate Supply
Demand Supply (% VAT Imposed) How to...?
Policy conflict and the Euro
Registering for the tutor2u VLU
Video Case-study - lunchtime prices slashed
Long Exam Example to Use for Revision Please?
