Cocoa futures experienced significant declines on Friday as robust shipments from the Ivory Coast triggered profit-taking and long liquidation. September ICE NY cocoa (CCU26) fell -390 (-6.04%), while London cocoa (CAU26) dropped -306 (-6.37%).
Cumulative Ivory Coast exports rose to 2.07 MMT during the current marketing year, up 21% year-over-year. Rising inventories and weather-related disruptions in the region intensified bearish sentiment despite stronger demand signals from Barry Callebaut AG, which reported a 5.7% sales increase in fiscal Q3.
Weekly cocoa inventories hit a near-two-year high of 3.15 million bags, weighing on prices. Heavy rains in key producing countries delayed shipments and raised disease risks, potentially lowering yields. Meanwhile, early 2026/27 crop assessments indicate an 18% decline in expected supply compared to last season.
Market dynamics reflect conflicting forces: weak global processing demand (down -3.8% in North America, -7.8% in Europe) contrasts with mixed regional performance, including a +5.2% rise in Asian grindings. Limited Nigerian supplies, down -11% year-on-year, provided limited support.
US climate forecasts warning of an unusually strong El Niño event add medium-term uncertainty, as the pattern threatens to dry West African soils and reduce cocoa viability. Industry analysts note that Gulf of Guinea exporters’ vulnerability to weather remains a critical factor for price stabilization.