Cocoa Prices Fall as Favourable West African Weather Boosts Supply Outlook

Cocoa prices retreated after forecasts of improving weather conditions in West Africa raised expectations of better yields and higher supplies from the world’s two largest cocoa-producing nations.

Ivory Coast, the world’s largest cocoa producer, boosted its cocoa delivery estimate to 2.2 million metric tonnes for the 2025/26 season, up from a previous projection of 1.8 to 1.9 million metric tonnes, citing favourable weather. Cumulative shipments from Ivory Coast farmers rose 3 per cent year-on-year in the current marketing year running from October 2025 through June 2026. Cocoa farmers in Ghana said rains have been regular and helpful to cocoa tree and pod development ahead of the harmattan season.

The pullback follows a period of elevated prices driven by supply concerns. The prolonged closure of the Strait of Hormuz has been disrupting global cocoa supply chains, raising fertiliser costs, shipping rates, insurance costs, and fuel prices, adding pressure to cocoa importers’ overall cost structures.

The medium-term picture, however, remains cautious. Early surveys of the 2026/27 West African cocoa crop show below-average cherelle formation on cocoa trees, signalling a weak outlook for the main cocoa harvest beginning in October. StoneX cut its 2026/27 global cocoa surplus estimate to 149,000 metric tonnes from a January forecast of 267,000 metric tonnes, citing risks from an expected El Niño weather event.

On the demand side, recent earnings from top chocolate makers Hershey and Mondelez International were better than expected, indicating that consumer demand for chocolate remains steady despite elevated prices.

For West African farmers, the immediate news is positive. Good rains now mean healthier pods and stronger harvests for the near-term crop. But the warning signs on the 2026/27 season, combined with El Niño risk and ongoing supply chain disruption from the Middle East conflict, mean the cocoa market remains far from settled.

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