Worldwide chocolate sales are expected to gain 2 percent in 2014, with Asian sweet tooth cravings expected to outperform global demand by an annual 5 percent, according to market research firm Euromonitor.
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Phillip analysts also pointed out that current, elevated cocoa-butter-ratios reflect strong consumption trends in North American, Asian and European markets.
Sandhu expects a cocoa deficit of 200,000 tons this year on the back of rising demand.
Meanwhile, the International Cocoa Organization (ICCO) said last month that it expects demand to exceed production by 70,000 metric tons for the season that began in October.
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The body believes the output deficit could continue through to 2018, which would be the longest streak since the organization started gathering data.
"It is unlikely that the cocoa market will see the light at the end of the tunnel anytime soon as demand is expected to grow while production remains sluggish, further worsening the supply deficit situation. The high likelihood that global cocoa supplies are unable to meet demand will be a significant source of support to the cocoa market," Phillip Futures said in their report.
— By CNBC.com's Nyshka Chandran. Follow her on Twitter