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On December 4, cocoa prices fell to 1.75-year lows, with December ICE NY cocoa down 3.63% and December ICE London cocoa #7 down 0.90%. This decline is attributed to expectations of potential tariff cuts on cocoa following statements from US Treasury Secretary Bessent about upcoming announcements regarding tariffs on crops not grown in the US.
Cocoa demand remains weak; Hershey reported disappointing chocolate sales ahead of Halloween, a season accounting for nearly 18% of annual US candy sales. Additionally, Q3 grindings showed a 17% year-on-year decline in Asia and a 4.8% decline in Europe. In contrast, North American cocoa grindings rose 3.2% year-on-year, though influenced by data reporting changes.
Ivorian cocoa exports have moderated, with a 9% decline reported for the current marketing year compared to last year. Furthermore, the International Cocoa Organization projected a global cocoa deficit of 494,000 MT for 2023/24, marking the largest in over 60 years.
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