On Tuesday, September ICE NY cocoa (CCU26) closed up $87 (+1.58%), and September ICE London cocoa #7 (CAU26) rose $76 (+1.86%), driven by short covering as prices consolidated above last week’s lows. This rebound follows a report from the European Cocoa Association revealing a 4.6% drop in Q2 European cocoa grindings, down to 316,366 MT, the lowest for Q2 in six years. However, North American cocoa grindings unexpectedly increased by 7.7% year-over-year to 109,659 MT, easing demand concerns.
Current shipping estimates from the Ivory Coast indicate farmers have sent 2.10 million metric tons (MMT) of cocoa to ports for the marketing year, up 21% from the previous year. Nigeria’s cocoa exports also saw a significant rise of 30% year-over-year to 18,922 MT. Rising cocoa inventories have reached a two-year high of 3,285,161 bags, contributing to bearish price conditions, despite recent weather concerns and a potentially smaller crop forecast in upcoming harvest seasons due to worsening El Niño conditions.
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