Here Is Why the Cocoa Bean Is the Only Asset That Is Giving NVIDIA a Run for Its Money
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NVIDIA is all over the news these days, and rightly so. After all, the stock is up 235 percent in the past year alone, having added the entire market capitalization of Netflix or AMD within the span of just a few hours earlier this week after posting another across-the-board stellar quarterly earnings. Yet, there is another asset that is poised to give NVIDIA a run for its money: the humble cocoa bean.
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Such was the level of interest around NVIDIA shares this week, that traders spent a whopping $20 billion betting on the stock, eclipsing the rest of the "Magnificent 7" grouping of high-flying names by a wide margin.
Also, the GPU manufacturer's AI-driven rally has now made its CEO, Jensen Huang, the 21st richest person in the world, with his net worth increasing by around $25 billion since the start of 2024 alone!
Yet, NVIDIA's blazing glory is currently under the threat of being upstaged by none other than the cocoa bean.
As can be seen in the above chart, the price of the cocoa bean - the most important ingredient to make chocolate - is up an astonishing 166 percent over the past year. And, with its supply woes set to continue, the cocoa bean appears poised to upstage NVIDIA's rip-roaring rally.
Why is the Price of the Cocoa Bean Increasing?
There are several factors that are responsible for creating an almost perfect supply storm for the cocoa bean:
- The last major cocoa tree planting spree occurred in the early 2000s in West Africa, which accounts for around 75 percent of the current global supply. Those trees are now around 25 years old and well past their prime.
- Bad weather, accentuated by the ongoing El Nino phase of the Pacific Ocean, has decimated cocoa trees in Ghana and Ivory Coast.
- The world is heading
