🚜African farm owners have great margin of profit. It costs $ 1,4 thousand to grow ton of $COCOA.FUT in Nigeria. If you own a land.
📌$ 3,6 thousand profit on each ton is enough for farmers not to seek other #oatt alternatives.
Data becomes complicated if you need a land. Firstly, because🏝️land price is little bubbled (some farmers believe cocoa price will never go back, this is common feeling on the ground). Secondly, I tried both, to purchase the land and to rent it. Renting is the worst.
📌For land renters, expense to produce a ton can go up to 3,5 thousand a ton.
📌For land buyers expense to produce a ton can go up to 2,27 thousand a ton.
I use wording it can go up to, because I am not local, and locals know how to reduce costs far better than I can.
For this reason, I might be keen to short bellow 3,5 thousand a ton this year. I would become passive. Also I might switch teams and start buying at 2 - 2,5 thousand per ton. This is my hypothetical guidelines only, all can change.
This article is not investment advice. Author of the post have investments in: cocoa futures, chocolate factories and cocoa fertilizer producers.... Show More
So , to you, prices are likely to fall further, doesn't it ? ... Show More
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