On Monday, July ICE NY cocoa prices closed up by 2.73% at +267, while July ICE London cocoa #7 rose by 1.68% to +108. Cocoa prices regained strength due to a weakening dollar index and a slowdown in cocoa exports from the Ivory Coast, where farmers have shipped 1.66 million metric tons (MMT) from October 1 to June 15, a 6.4% increase from last year but lower than a previous 35% spike in December.
Concerns about declining cocoa export volumes were also reinforced by an 11% year-on-year drop in Nigeria’s cocoa exports for April, totaling 18,561 metric tons. Additionally, cocoa processors reported quality issues, with 5% to 6% of the Ivory Coast’s mid-crop cocoa being of poor quality, compared to just 1% during the main crop, with the estimated mid-crop production down 9% to 400,000 metric tons this year.
The International Cocoa Organization (ICCO) projected a global cocoa deficit of 494,000 metric tons for the 2023/24 season, marking the largest deficit in over 60 years, as production is forecasted to decline by 13.1% year-on-year to 4.380 MMT. Meanwhile, North American and European cocoa grindings experienced declines of 2.5% and 3.7%, respectively, during Q1.
