Cocoa Hits 4-week Low

Cocoa futures rose toward $5,500 per tonne, the highest level in nearly a week, supported by short covering as forecasts of dry conditions in top grower Ivory Coast raised concerns over the 2026/27 crop. At the same time, early surveys pointed to below-average cherelle formation on cocoa trees, signalling a weaker outlook for the main harvest, which began this month. Still, near-term supply remains ample, underpinned by a large global surplus in 2025/26 and inventories at a two-year high of 3.43 million bags. The medium-term outlook is less favourable, however, with estimates for 2026/27 pointing to weaker crops across West Africa due to elevated weather risks. Ivory Coast's output is expected to fall about 20% to 1.75 million tonnes, while Ghana’s production is forecast to decline 13% to 650,000 tonnes. These risks could be compounded by an unusually strong El Niño, potentially intensifying dry Harmattan winds from around November.

Cocoa decreased to 5711.00 USD/T, the lowest since August 2026. Over the past 4 weeks, Cocoa lost 2.62%, and in the last 12 months, it decreased 20.31%.

Cocoa futures fell below $5,400 per tonne, their lowest since late July, amid signs of abundant short-term supply. ICE cocoa inventories stand at a two-year high of around 3.43 million bags. Moreover, Ivory Coast cocoa shipments reached 2.14 million metric tons in the current international marketing year through Sept. 13, up 18% from a year earlier, according to Bloomberg. Meanwhile, the market continues to monitor crop diseases, excessive rainfall, and plantation conditions across West Africa. The outlook for the 2026/27 season remains uncertain, with weather risks, particularly the development of the El Niño weather pattern, threatening crops in the Ivory Coast and Ghana. This year’s strong El Niño could intensify the dry harmattan winds, which typically arrive in the region around November. This would mark a shift from excessive moisture to conditions that could threaten the final stages of the main crop, which typically runs from October to March.