Robust Ivory Coast Cocoa Supplies Weigh on Prices

September ICE NY cocoa (CCU26) on Friday closed down -390 (-6.04%), and September ICE London cocoa #7 (CAU26) closed down -306 (-6.37%).

Cocoa prices finished sharply lower on Friday as signs of robust cocoa supplies from the Ivory Coast sparked profit-taking and long liquidation in cocoa futures.  Cumulative data from the Ivory Coast on Friday showed that farmers shipped 2.07 MMT of cocoa to ports in the current marketing year (October 1, 2025, through July 5, 2026), up +21% from the same period a year ago.

Rising cocoa inventories are bearish for prices.  ICE cocoa inventories rose to a nearly 2-year high of 3,151,790 bags on Friday.

Cocoa prices have rallied sharply over the past three weeks, with NY cocoa hitting a 6-month high and London cocoa hitting a 9.25-month high on Thursday.  Heavy rains in the Ivory Coast and Ghana have flooded roads, cutting off farmers’ access to farms and ports and threatening global supplies. Excessive moisture also increases the risk of brown rot disease and black pod disease on cocoa trees, reducing yields and jeopardizing the harvest.

Signs of a recovery in cocoa demand are also bullish for prices after Barry Callebaut AG, the world’s largest cocoa processor, reported on Thursday that fiscal Q3 sales rose by 5.7%, the first increase in more than 2 years.

Cocoa prices also have underlying medium-term support from future weather concerns.  On Wednesday, the US Climate Prediction Center said the El Niño weather pattern that emerged across the equatorial Pacific last month will likely be one of the strongest in more than 75 years.  An El Niño typically brings warmer, drier conditions to West Africa, reducing soil moisture, stressing cocoa trees, and lowering yields. 

Cocoa prices also have support from early surveys of the 2026/27 Ivory Coast cocoa crop, which show below-average cherelle formation on cocoa trees, signaling a weak outlook for the main cocoa harvest, which begins in September.  Early crop assessments show poor pod development and an average estimate of 1.8 MMT for the season starting in September, down -18% from about 2.2 MMT in 2025/26.  The markets are awaiting new surveys in July to determine the final size of the cocoa crop.

Cocoa prices were under pressure last month amid signs of abundant supply.  On June 11, the Ivory Coast boosted its estimate of cocoa that has reached its ports by more than 260,000 MT so far this season.  The Ivory Coast recently said its cocoa production in 2025/26 would fall -10.8% y/y to 1.65 MMT from 1.85 MMT in 2024/25. 

Signs of larger global cocoa supplies are negative for cocoa prices.  On June 25, Bloomberg reported that Nigerian cocoa exports in May rose +28% y/y to 18,034 MT. 

Weak global cocoa demand is bearish for prices.  The National Confectioners Association reported April 23 that North American Q1 cocoa grindings fell -3.8% y/y to 106,087 MT.  Also, the European Cocoa Association reported that Q1 European cocoa grindings fell -7.8% y/y to 325,895 MT, a bigger decline than expectations of -6% y/y and the lowest for a Q1 in 17 years.  Conversely, the Cocoa Association of Asia reported that Q1 Asian cocoa grindings unexpectedly rose +5.2% y/y to 223,503 MT, stronger than expectations of a decline of -6.7% y/y. 

Smaller cocoa supplies from Nigeria, the world’s fifth-largest cocoa producer, are supportive for prices.  Nigeria’s Cocoa Association projects that Nigerian cocoa production in 2025/26 will fall by -11% y/y to 305,000 MT, from a projected 344,000 MT for the 2024/25 crop year. 

In February, Ghana cut the official price it pays its cocoa farmers by nearly 30% for supplies for the 2025/26 growing season.  In March, the Ivory Coast also said it would cut cocoa farmers’ pay by 57%, effective for the mid-crop harvest that began in March.  The Ivory Coast and Ghana produce more than half of the world’s cocoa. 

The outlook for a smaller global cocoa surplus is supportive of cocoa prices.  On April 29, StoneX cut its 2026/27 global cocoa surplus estimate to 149,000 MT from a January forecast of 267,000 MT, citing risks to the West African cocoa crop from an expected El Niño weather event.  StoneX also cut its 2025/26 global cocoa surplus forecast to 247,000 MT from a January estimate of 287,000 MT.