As of December 22, 2023, March ICE New York cocoa (CCH26) is down 0.13%, while March ICE London cocoa #7 (CAH26) has fallen 2.02%. This follows a slight decrease in cocoa prices attributed to long liquidation pressure ahead of the weekend, despite underlying support from anticipated index-related buying due to the upcoming inclusion of cocoa futures in the Bloomberg Commodity Index (BCOM) in January, potentially attracting up to $2 billion in buying.
Cocoa inventories monitored by ICE at U.S. ports have declined to a 9.5-month low of 1,626,861 bags as of December 19, 2023. Additionally, during the current marketing year (October 1 to December 21), exports from the Ivory Coast, the world’s largest cocoa producer, stand at 970,945 metric tons, a minor decrease of 0.1% from the same period last year. Recent government data shows favorable weather conditions benefitting cocoa farmers in both the Ivory Coast and Ghana.
Global cocoa supply looks tighter as the International Cocoa Organization (ICCO) recently revised its 2024/25 surplus estimate down to 49,000 metric tons from 142,000 metric tons. The overall cocoa production estimate for that year has also been lowered to 4.69 million metric tons. In contrast, the Cocoa Association of Asia reported a significant year-over-year decrease in Q3 cocoa grindings of 17%, while European cocoa grindings fell by 4.8%, signifying a decline in demand.
