On Tuesday, September ICE NY cocoa (CCU25) fell by 4.86% to a decline of 403 points, while September ICE London cocoa #7 (CAU25) decreased by 2.85%, losing 153 points. The drop is attributed to demand concerns following a report from the Malaysian Cocoa Board indicating a 22% year-on-year decline in cocoa bean processing for Q2. The market anticipates quarterly cocoa grinding reports scheduled for Thursday.
Additionally, Barry Callebaut AG reported a 9.5% decline in March-May sales volume, the largest quarterly drop in a decade, influencing cocoa prices negatively. In the Ivory Coast, farmers shipped 1.73 million metric tons of cocoa from October 1 to July 13, marking a 6.8% increase year-on-year, though lower than previous months. Meanwhile, U.S. cocoa inventories are near a 10-month high with 2,336,040 bags as of Tuesday, raising further concerns about market stability.
The International Cocoa Organization revised the global cocoa deficit for 2023/24 to 494,000 metric tons, the highest in over 60 years, with global cocoa production down by 13.1% year-on-year to 4.38 million metric tons. Looking ahead, a projected surplus of 142,000 metric tons for 2024/25 comes with a forecasted increase in global production to 4.84 million metric tons.
