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Ivory Coast Harvest Pressures Weigh on Cocoa Prices
December ICE NY cocoa (CCZ24) today is down -92 (-1.26%), and December ICE London cocoa #7 (CAZ24) is down -141 (-2.43%).
Cocoa prices are under pressure today for a second day as the pace of the Ivory Coast cocoa harvest accelerates. Monday's government data showed that Ivory Coast farmers shipped 365,072 MT of cocoa to ports from October 1 to November 3, up +26% from 288,686 MT shipped the same time last year. The Ivory Coast is the world's largest cocoa producer.
Cocoa prices were also undercut when the Ivory Coast regulator Le Conseil Cafe-Cacao on October 18 raised its Ivory Coast 2024/25 cocoa production estimate to a range of 2.1-2.2 MMT from a June forecast of 2.0 MMT.
Recent global cocoa demand news has been mixed. The National Confectioners Association on October 17 reported that North American Q3 cocoa grindings rose +12% y/y to 109,264 MT. Also, the Cocoa Association of Asia reported that Q3 Asian cocoa grinding rose +2.6% y/y to 216,998 MT. However, the European Cocoa Association reported that European Q3 cocoa grindings fell -3.3% y/y to 354,335 MT.
Shrinking global cocoa stockpiles are bullish for prices. ICE-monitored cocoa inventories held in US ports have been trending lower for the past 17 months and fell to a 19-year low Monday of 1,747,511 bags.
Cocoa found support after Ghana's Cocoa Board (Cocobod) on August 20 cut its 2024/25 Ghana cocoa production estimate to 650,000 MT from a June forecast of 700,000 MT. Due to bad weather and crop disease, Ghana's 2023/24 coca harvest sank to a 23-year low of 425,000 MT. Ghana is the world's second-biggest cocoa producer, and its 2024/25 cocoa harvest begins in October.
An increase in cocoa production by Cameroon, the world's fifth-largest cocoa producer, is bearish for cocoa prices. On August 21, Cameroon's National Cocoa and Coffee Board reported that in 2023/24 (Aug/July), Cameroon cocoa production rose +1.2% y/y to 266,725. Also, Nigeria's August cocoa exports rose by +6.8% y/y to 14,984 MT. Nigeria is the world's sixth-largest cocoa producer.
In a bullish factor, the International Cocoa Association (ICCO) on August 30 raised its 2023/24 global cocoa deficit estimate to -462,000 MT from May's -439,000 MT, the largest deficit in over 60 years. ICCO also cut its 2023/24 cocoa production estimate to 4.330 MMT from May's 4.461 MMT. ICCO projected a 2023/24 global cocoa stocks/grindings ratio of a 46-year low of 27.4%.
More Cocoa News from Barchart
- Below-Normal Rainfall in Brazil Supports Coffee Prices
- Sugar Closes Lower on Improved Growing Prospects in Brazil
- Cocoa Prices Post Moderate Losses as the Ivory Coast Cocoa Harvest Picks Up
- Coffee Prices Supported by Below-Normal Rainfall in Brazil
On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.