As of September, cocoa prices are facing declines, with September ICE NY cocoa down $22 (-0.25%) and July ICE London cocoa down $41 (-0.68%). Recent optimism regarding West African cocoa crops, bolstered by beneficial rainfall, has pressured prices, which recently hit multi-month lows.
Current cocoa inventories in the U.S. have risen to a 9-1/4 month high of 2,363,861 bags, recovering from a 21-year low of 1,263,493 bags earlier this year. Meanwhile, Nigerian cocoa exports fell by 29% year-over-year in May, totaling 14,110 MT, indicating potential tighter supplies. Despite a 6.9% increase in cocoa shipments from the Ivory Coast this marketing year, heavy rains have disrupted harvesting activities.
The International Cocoa Organization has projected a global cocoa deficit of 494,000 MT for 2023/24, the largest in over 60 years. Additionally, the Q1 2023 cocoa grindings dropped by 2.5% in North America, 3.7% in Europe, and 3.4% in Asia, suggesting decreasing demand for cocoa products amid tariff uncertainties and rising prices.
