Cocoa Futures Dip After Hitting Record High

Cocoa futures experienced a dip after hitting a fresh record earlier on Tuesday, with the most-active contract in New York falling as much as 2.5%. This year’s remarkable rally, coupled with lower open interest, has rendered the market more susceptible to volatility. Cocoa prices have more than doubled this year due to lower West African production, and the market has become more choppy with volatility at its highest in about 15 years. The increase in volatility combined with the historic rally has left the cocoa market in a more vulnerable position, impacting futures trading.