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(ZEROHEDGE) – U.S. chocolate maker Hershey slashed its sales and earnings outlook on Thursday, citing higher cocoa prices that have resulted in demand destruction among cash-strapped consumers. This development spooked cocoa futures, sliding to a five-month low at the end of the week.
Cocoa futures in New York fell as much as 6% to $6,574 a ton, hitting their lowest level since early March following the dismal earnings report from Hershey. Prices, which peaked at $12,000 a ton in mid-April, have nearly halved and have been oscillating within a triangle formation ever since.
Bloomberg noted, “Market watchers are closely monitoring company earnings for signs that consumers are buying less as costs rise.” It added, “Many expect volatility to continue as uncertainty also lingers on the supply side.”
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