December ICE NY cocoa (CCZ25) today is up +219 (+2.81%), and September ICE London cocoa #7 (CAU25) did not conduct transactions with markets that were closed due to a bank holiday in the UK.
Cocoa prices are rising today due to worries that cold and dry conditions in West Africa’s cocoa-growing areas are hindering plant growth in the Ivory Coast and increasing black pod disease in Ghana and Nigeria.
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Cocoa prices are also supported by reduced stock levels. ICE-observed cocoa inventories stored in US ports dropped to a 2.75-month low of 2,189,496 bags as of last Friday.
Cocoa prices surged to 2-month peaks earlier this month due to worries about dry conditions in Western Africa. The Commodity Weather Group reported that the 30-day period ending August 15 was the driest for the Ivory Coast in 46 years. The shortage of rainfall may affect the ability of cocoa pods to remain on trees ahead of the primary crop harvest, which begins in October.
The reduced rate of cocoa exports from Ivory Coast is positive for cocoa prices. Recent government data revealed that Ivory Coast farmers transported 1.79 million metric tons of cocoa to ports during this marketing year, from October 1 to August 24, representing a 5.9% increase from last year, although this is lower than the significant 35% rise recorded in December.
Concerns about the quality of the Ivory Coast’s mid-crop cocoa, which is currently being gathered through September, are helping to support prices. Cocoa processors are expressing dissatisfaction with the quality of the harvest and have turned away shipments of Ivory Coast cocoa beans. They noted that approximately 5% to 6% of the mid-crop cocoa in each shipment is of substandard quality, compared to 1% during the main crop. Rabobank suggests that the lower quality of the mid-crop is partially due to delayed rainfall in the area, which hindered crop development. The mid-crop is the smaller of the two annual cocoa harvests, which usually begins in April. This year’s estimated yield for the Ivory Coast’s mid-crop averages 400,000 MT, a decrease of 9% from last year’s 440,000 MT.
Another contributing factor for cocoa is the reduced cocoa output in Nigeria, which is the world’s fifth-largest producer. The Nigerian Cocoa Association forecasts that Nigeria’s 2025/25 cocoa production will decrease by -11% year-over-year to 305,000 metric tons from an estimated 344,000 metric tons for the 2024/25 harvest. In other developments, Nigeria’s June cocoa exports increased by +0.9% year-over-year to 14,597 metric tons.
A decrease in demand for chocolate is also affecting cocoa prices negatively. In July, chocolate manufacturer Lindt & Spruengli AG adjusted its profit margin forecast for the year because of a more significant drop in first-half chocolate sales than anticipated. Additionally, chocolate producer Barry Callebaut AG has lowered its sales volume projection for the second time in three months, citing ongoing high cocoa prices. The company expects a reduction in annual sales volume and reported a -9.5% decrease in sales volume during the March-May period, which represents the biggest quarterly decline in ten years.
A decline in global demand for cocoa has acted as a negative influence on cocoa price trends. On July 17, the European Cocoa Association announced that cocoa grinding activities in Europe during the second quarter dropped by -7.2% compared to the previous year, reaching 331,762 metric tons, which was a more significant decrease than the anticipated -5% year-over-year. Additionally, the Cocoa Association of Asia noted that cocoa grinding in Asia decreased by -16.3% year-on-year to 176,644 metric tons, marking the lowest level for a second quarter in eight years. In North America, cocoa grinding fell by -2.8% year-on-year to 101,865 metric tons, representing a smaller drop compared to the declines observed in Asia and Europe.
Increased cocoa output from Ghana is negative for cocoa prices. On July 1, the Ghana Cocoa Board forecasted the 2025/26 Ghana cocoa harvest would rise by +8.3% year-over-year to 650,000 from 600,000 MT in 2024/25. Ghana ranks as the world’s second-largest cocoa producer.
On May 30, the International Cocoa Organization (ICCO) updated its 2023/24 global cocoa shortfall to -494,000 MT, up from a February projection of -441,000 MT, marking the biggest deficit in more than six decades. ICCO reported that 2023/24 cocoa output dropped by 13.1% year-over-year to 4.380 MMT. The organization noted that the 2023/24 global cocoa stocks-to-grindings ratio fell to a 46-year low of 27.0%. For 2024/25, ICCO, on February 28, predicted a global cocoa surplus of 142,000 MT, the first surplus in four years. ICCO also anticipated that 2024/25 global cocoa production will increase by 7.8% year-over-year to 4.84 MMT.
On the day of release,Rich AsplundDid not hold (either directly or indirectly) any positions in the securities discussed in this article. All information and data presented in this article is for informational purposes only. For further details, please refer to the Muara Digital Team Disclosure Policy.here.
