Cocoa futures managed a modest recovery over the past two weeks following sharp declines from index rebalancing and Ivory Coast exporter defaults, but the rebound lacks conviction and may represent only a temporary exhaustion of sellers rather than strong buyer commitment.

London cocoa futures for the May contract increased £93 or 3.1% versus the previous week, but remain down £1,245 or 29% versus a month ago. New York May cocoa futures increased $60 or 1.4% versus the previous week, but remain down $1,717 or 28.6% versus a month ago.

The sharp price decline has created significant pain for farmers in West Africa, with cocoa stuck upcountry and farmers likely facing a reduction of the farmgate price from April onwards.

Ghana and Ivory Coast face payment crisis

Ghana’s cocoa industry regulator and finance ministry are in talks to decide between lowering what farmers are paid for their beans or subsidizing them, with global prices slumping below domestic levels. Until a decision is made, growers are stuck with approximately 150,000 metric tons of cocoa as the Ghana Cocoa Board has paused its purchases.

Cocobod has purchased roughly 500,000 metric tons of beans since the season began in August, out of its annual target of 650,000 metric tons. The Ghana farmgate price stands at 58,000 cedis ($5,340 per metric ton). Licensed buying companies stopped buying cocoa approximately two months ago, with the government not having paid for earlier supplies.

Michael Acheampong, a chief farmer who supervises other growers in the town of Kwarbeng, stated: “The licensed buying companies stopped buying cocoa about two months ago. Government has not paid for earlier supplies, we are stuck with many bags of beans without buyers.”

Ivory Coast faces similar troubles, with exporters struggling to fulfill their forward contracts agreed to with the regulator at the top of the market. The government has promised to help Le Conseil Café-Cacao negotiate a 280 billion CFA franc ($500 million) loan to purchase about 100,000 metric tons of beans from farmers.

Cocoa arrivals at ports in Ivory Coast reached 1.233 million metric tons by February 1, down 4.4% from 1.289 million metric tons in the same period a year earlier. The slowing pace reflects unsold beans stuck upcountry rather than a shortage of beans.

Ghana proposes emergency reforms

Ghana’s Licensed Cocoa Buyers Association has urged sweeping funding, pricing and governance reforms, warning that delays risk entrenching the crisis. The association said the sector is buckling under funding shortages, weak sales strategy, and governance lapses.

LICOBAG executive secretary Victus Dzah pressed the government to raise emergency financing to clear cocoa stocks already produced but not yet paid for. “Government must, as a matter of urgency, secure a facility to pay for an estimated 300,000 metric tons of cocoa in a phased manner between now and September,” he said.

The group proposed a hybrid funding arrangement combining syndicated facilities with the current structure to enable real-time payment for cocoa purchased and delivered to port. Ghana Cocoa Board CEO Randy Abbey announced plans for a new cocoa funding model to support local processing and curb exports of beans, with implementation planned for the 2026/27 crop season.

Swollen shoot disease threatens long-term supply

Swollen shoot disease puts 15% of Ivory Coast’s cocoa production at risk, according to a study by the non-profit Enveritas. The advocacy group surveyed over 11,600 cocoa farms and found more than 41% were infected with the virus in the 2024/25 season, versus 33% two seasons ago.

The disease reduces yields by approximately 35%. Spread by mealybugs, swollen shoot initially allows trees to produce at a reduced rate but kills them after five to ten years. Although prices declined sharply as the market anticipates a material surplus, supplies remain at risk long-term in West Africa if the disease is not brought under control.

Ghana’s last nationwide survey in 2023 showed 31% of total cocoa-growing land was infected with swollen shoot versus 17% in 2017. The disease decimated Ghana’s crop in the 1960s and 1970s, reducing production by 50% when the country was the world’s largest cocoa producer.

Market outlook

For a sustainable rally, the market requires demand to show signs of recovering, resolution of unsold cocoa from current and next crops, and supply concerns from Harmattan or other factors. Speculators remain sizeable short, but current fundamentals do not support sustained price increases.

Cocoa demand fell sharply after 2024’s price surge, reaching 21-year lows in the fourth quarter of last year in Europe as chocolate makers shrink product sizes and reformulate recipes. Relative calm with a longer period of low and stable prices would benefit FMCG companies and consumers, who could expect lower retail prices for chocolate confectionery in the second half of 2026.



This article is part of a more comprehensive cocoa market analysis. For the full cocoa market analysis, visit: https://app.vespertool.com/market-analysis/2695