Hedge Fund Manager Controls Market for Addictive Drug: Chocolate

Tuesday, July 27, 2010
Anthony Ward

With prices for cocoa having already risen 150% since 2008, makers of chocolate are up in arms over a British hedge fund manager’s recent buying spree of the valuable crop. Anthony Ward, head of the investment firm Armajaro, now controls the equivalent to 7% of the world’s annual cocoa production, which is enough to manipulate prices on commodities markets. Armajaro is active in the cocoa-growing nations of Côte d’Ivoire, Ghana, Indonesia, Nigeria and Ecuador.

Analysts say Ward’s stockpiling of cocoa—enough to make more than five billion chocolate bars—has helped drive prices on the London market to a 30-year high. Some European traders, including the German Cocoa Trade Association, have demanded officials with the London exchange take action against Ward.
-Noel Brinkerhoff
Trader’s Cocoa Binge Wraps Up Chocolate Market (by Julia Werdigier and Julie Creswell, New York Times)


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