Cocoa opened last week with a strong rally and then gave it back over consecutive down days, a pattern Martijn Bron attributes to the volatility of the current “silly season.” London September futures finished about 2.0% higher week on week but down 4.1% over two weeks, while New York gained 1.0% on the week. Both remain up roughly 15% on the month.
Demand is the drag. Nielsen data show European chocolate confectionery volumes still falling, down more than 6% year on year, with the 52-week unit volume off 6.4% even as average prices rose 13.3%. The analysis is cautious on a near-term recovery, pointing to an inflationary backdrop, record-high equity markets that sit at odds with supermarket choices, and the prospect of an energy shock if the Middle East conflict drags on.
Supply signals point to more cocoa, not less. Ivory Coast now expects 2025/26 output of 2.0 to 2.1 million tonnes, up 10.5% and the first rise in three seasons, well above the 1.8 million tonnes a March Reuters poll had pencilled in. The Coffee and Cocoa Council credits better fertiliser use and plantation management. Traders say large volumes remain unsold in Ivory Coast, and recent selling could make the surplus more visible in European warehouses in the coming weeks. Arrivals at Ivorian ports reached 1.637 million tonnes by May 24, up 2.2% on the season.
Two longer-term threats sit underneath. Forecasters now put El Niño emergence at 82% for May to July and 96% for the 2026-27 winter, a risk to the next crop, and Ivorian pod counts are running slightly below last year. The EU’s deforestation regulation, due to take effect at the end of the year, is adding traceability and compliance costs, with Ghana planning to seek a $200/mt premium for compliant cocoa.
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