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March ICE NY cocoa prices fell by $78 (-1.50%) to a 1.75-year low, while December ICE London cocoa #7 prices dropped by $36 (-0.97%) as of today, amid expectations that the EU will delay its Deforestation Regulation for another year. This delay eases supply concerns for cocoa imports from deforestation-affected regions, allowing continued agricultural product imports from Africa, Indonesia, and South America.
In West Africa, positive harvest forecasts contribute to the price decline. Cocoa pod counts reported by Mondelez are 7% above the five-year average. Cocoa arrivals to Ivorian ports have decreased by 3.7% year-on-year, totaling 618,899 MT from October 1 to November 23. The International Cocoa Organization (ICCO) has also projected a global cocoa deficit of 494,000 MT for the 2023/24 season, highlighting significant production declines.
Demand concerns exacerbate the situation, with Q3 cocoa grindings in Asia falling by 17% year-on-year and a 21% drop in North American chocolate sales volume for the 13 weeks ending September 7. The ICCO expects a global cocoa surplus of 142,000 MT in 2024/25, indicating a potential shift in the market dynamics.
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