On June 12, 2023, cocoa prices reached six-week highs, with July ICE NY cocoa up +14 (+0.31%) and July ICE London cocoa #7 up +23 (+0.66%). Prices are influenced by heavy rains in the Ivory Coast, disrupting farmers’ access to their farms and increasing the risk of brown rot disease, which could significantly reduce yields. The U.S. dollar index also rose, affecting prices.
The Ivory Coast’s cocoa production for the 2025/26 season is projected to fall by -10.8% year-on-year to 1.65 million metric tons (MMT) from 1.85 MMT in 2024/25. Despite increasing shipments this season, with a total of 1.95 MMT reported by June 7, cocoa inventories are at a 1.75-year high of 2,914,908 bags, contributing to bearish market sentiment. Additionally, weak demand is evident as North American cocoa grindings fell -3.8% year-on-year to 106,087 MT in Q1 2023.
The National Oceanic and Atmospheric Administration estimates a 67% chance of a “Super El Niño” affecting West Africa’s weather patterns, potentially stressing cocoa trees and lowering yields. Forecasts suggest a smaller global cocoa surplus, with StoneX cutting its surplus estimate for both 2025/26 and 2026/27 due to weather risks.
5 Stocks Our Experts Predict Could Double In the Next Year
By submitting your email, you'll also get a free pivot & flow membership. A free daily market overview. You can unsubscribe at any time.
