Cocoa Prices Rise on West African Supply Concerns

The September ICE New York cocoa (CCU26) contract closed Tuesday at a gain of 111 points, up 2.23%, while the July ICE London cocoa #7 (CAN26) contract finished at a 104‑point rise, a 2.80% increase.

Over the past two weeks, cocoa prices have surged by more than 20%, approaching 5½‑month highs attained last Thursday. The rally has been driven largely by heightened concerns about the forthcoming West African cocoa crop. Heavy rainfall in Ivory Coast and Ghana has flooded roads, hampering farmers’ access to farms and ports and threatening global supplies. The accumulated June rainfall, reaching levels close to the annual average in both countries, also raises the risk of brown‑rot and black‑pod diseases, which can reduce yields and jeopardize the overall harvest.

Additional medium‑term support for prices comes from evolving weather forecasts. On June 10, Japan’s Meteorological Agency confirmed the development of an El Niño pattern across the equatorial Pacific. El Niño typically brings warmer, drier conditions to West Africa, which can stress cocoa trees, lower yields, and sustain higher prices. NOAA estimates a 67% probability of a “Super El Niño” this year, one of the strongest on record.

Early surveys of the 2026/27 Ivory Coast cocoa crop also signal a weak outlook. The assessments indicate below‑average cherelle (pod) development, with an estimated 1.8 million metric tonnes for the season beginning in September—an 18% decline from the 2.2 million metric tonnes projected for 2025/26. Market participants await new July surveys that will define the final crop size.

Recent data from the Ivory Coast suggest an overall supply boost. By June 11, the country reported that more than 260,000 tonnes of cocoa had reached its ports for the current marketing year, bringing the cumulative total to 2.04 million metric tonnes—20% higher than the same period a year earlier. The Ivory Coast also revised its 2025/26 production outlook to 1.65 million metric tonnes, down 10.8% year over year from 1.85 million in 2024/25.

Nigeria’s export figures further support price gains. Bloomberg reported that May cocoa exports rose 28% year over year to 18,034 tonnes.

However, rising inventories are a bearish signal. ICE cocoa inventory levels climbed to a 1.75‑year high of 2,948,286 bags last Thursday.

Demand-side pressure also weighs on prices. In North America, cocoa grindings fell 3.8% year over year to 106,087 metric tonnes in Q1 2024. European grindings declined 7.8% year over year to 325,895 metric tonnes, the lowest in 17 years, while Asian grindings unexpectedly rose 5.2% to 223,503 metric tonnes, outpacing negative expectations.

Supply tightening in Nigeria provides a countervailing effect. The Nigerian Cocoa Association projects a 11% year‑over‑year decline in production for 2025/26, down to 305,000 tonnes from the projected 344,000 tonnes for 2024/25.

In 2022, Ghana reduced the official price paid to cocoa farmers by nearly 30% for the 2025/26 season. The Ivory Coast followed in March, cutting farmer payments by 57% for the mid‑crop harvest that began in March. Together, these two nations produce more than half of the world’s cocoa.

Forecasts of a smaller global surplus support continued price strength. On April 29, StoneX cut its 2026/27 global cocoa surplus estimate to 149,000 tonnes from the January forecast of 267,000 tonnes, citing risks to the West African crop from an expected El Niño event. The company also reduced its 2025/26 surplus forecast to 247,000 tonnes from the January estimate of 287,000 tonnes.

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