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Jim Cramer likes to say that there's always a bull market somewhere. I think he's right. There's now a surging market in the cocoa pits. Yes, cocoa is hot! As always, we can blame hedge funds who have been making majors moves there. Check out this chart:

The Financial Times reports:

Investor interest in cocoa has overwhelmed the traditional trade buyers and sellers, such as the confectionary and cocoa processing companies, in the cocoa futures market.

Weekly data from the Commodity Futures Trading Commission, the US regulator, shows that hedge funds and commodity index funds with long positions, a bet on rising prices, accounted for about a third of all New York cocoa contracts held.

Cocoa markets are subject to wild price swings, which has made some veteran traders wary of predicting further price gains.

Posted by edelfenbein at March 20, 2007 2:39 PM