Cocoa prices have dropped significantly today, with July ICE NY cocoa falling by $187 (-4.08%) and July ICE London cocoa down by $148 (-4.31%). The decline follows a week of price rallies that have pushed cocoa to a 3.5-month high, driven by producer selling and a stronger U.S. dollar, which triggered long liquidation in cocoa futures.
Concerns over a potential El Niño weather pattern, which the NOAA estimates has a 61% likelihood of emerging, may negatively impact cocoa production in West Africa. Additionally, StoneX revised its 2026/27 global cocoa surplus estimate down to 149,000 metric tons from 267,000 metric tons, citing risks from the anticipated weather event. Conversely, weak global cocoa demand has become a bearish factor, with North American and European cocoa grindings down 3.8% and 7.8% year-over-year, respectively.
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