Cocoa futures surged on Tuesday, with September ICE New York cocoa rising sharply to a 6-month high and September ICE London cocoa climbing to a 7-month high as weather-driven supply risks intensified across West Africa.
ICE cocoa prices have gained sharply over the past three weeks amid heavy rains in the Ivory Coast and Ghana that have disrupted transport routes, limited farmers’ access to farms and ports, and increased the risk of crop disease—threats that traders are weighing against signs that the broader global market has had enough inventory to absorb demand softness.
Key takeaways
- Price move: September ICE New York cocoa climbed to a 6-month high, while September ICE London cocoa reached a 7-month high.
- Catalyst: Traders reacted to worsening West Africa weather conditions, including flooding and disease risks, alongside forward-looking concerns about El Niño.
- Supply implications: Early surveys for the 2026/27 Ivory Coast harvest point to weaker tree development, but rising inventories in the near term temper the rally.
- Demand backdrop: Recent grindings data show declines in North America and Europe, partially offset by strength in Asia.
- Market focus ahead: Investors are watching July crop surveys and additional weather signals that could confirm or fade the production risk.
What drove the move
The immediate driver was an escalating weather shock in West Africa. According to coverage cited in the market report, heavy rains in the Ivory Coast and Ghana have flooded roads and disrupted access to farms and ports, raising the likelihood of delays and output losses. Excess moisture also increases agronomic risks, including brown rot and black pod disease, which can reduce yields and endanger the harvest.
Beyond the current season, the rally also reflects forward-looking concerns about the climate pattern behind cocoa production conditions. Japan’s Meteorological Agency confirmed an El Niño had formed across the equatorial Pacific on June 10. The US National Oceanic and Atmospheric Administration estimates a 67% chance of a “Super El Niño” this year—conditions that often bring warmer, drier weather to West Africa, stressing cocoa trees and lowering yields.
Early planting and crop-quality assessments provided additional support. Early surveys of the 2026/27 Ivory Coast cocoa crop were reported to show below-average cherelle formation, a sign of a weaker outlook for the main harvest beginning in September. Early estimates cited in the report indicated an average crop size of 1.8 million metric tons for the 2026/27 season, down from about 2.2 million metric tons in 2025/26, with markets awaiting new surveys in July.
Market reaction: strong spot risk, but inventories and flows matter
While weather risk has lifted front-month pricing, the market’s reaction has not been purely bullish. Data cited in the report showed that ICE cocoa inventories rose to a nearly 2-year high of 3,082,154 bags on Tuesday, a factor that can cap upside by indicating a larger buffer of physical supply.
Traders were also weighing evidence of supply reaching ports despite the headline weather risk. The report noted that on June 11, the Ivory Coast boosted its estimate of cocoa arriving at its ports by more than 260,000 metric tons so far this season. Cumulative data through June 28, 2026 were reported at 2.04 million metric tons shipped to ports in the current marketing year (October 1, 2025 through June 28, 2026), up 20% versus the same period a year earlier.
At the same time, the report pointed to production outlook cuts. The Ivory Coast recently said 2025/26 production would fall 10.8% year over year to 1.65 million metric tons from 1.85 million metric tons in 2024/25, reinforcing the idea that the next production window may tighten—even if current port flows remain supportive.
Broader demand and supply signals
On the demand side, the report highlighted mixed grindings trends. The National Confectioners Association reported that North American Q1 cocoa grindings fell 3.8% year over year to 106,087 metric tons. In Europe, the European Cocoa Association said Q1 European cocoa grindings dropped 7.8% year over year to 325,895 metric tons—worse than expectations of a 6% decline and the lowest for a Q1 in 17 years.
Asia provided some offset. The Cocoa Association of Asia reported that Q1 Asian cocoa grindings unexpectedly rose 5.2% year over year to 223,503 metric tons, stronger than expectations of a 6.7% year-over-year decline.
Regional supply projections were also cited as a key variable. The report noted that Nigeria’s Cocoa Association projects Nigerian cocoa production in 2025/26 will decline 11% year over year to 305,000 metric tons from a projected 344,000 metric tons for 2024/25. Nigeria is the world’s fifth-largest cocoa producer, which makes changes in its output particularly relevant for global balancing.
In addition, policy and pricing actions in producing countries have been part of the longer-term supply calculus. In February, Ghana cut the official price paid to farmers by nearly 30% for the 2025/26 growing season, and in March the Ivory Coast said it would cut farmers’ pay by 57% effective for its mid-crop harvest that began in March. Together, the Ivory Coast and Ghana produce more than half of the world’s cocoa, meaning farmer economics can influence future planting and yields.
What to watch next
Investors are likely to focus on whether weather conditions worsen further or stabilize, and on the next set of crop surveys in July that are expected to refine the size of the 2026/27 Ivory Coast crop. The market will also track ongoing inventory developments and further demand data from major grinding regions, which could either reinforce the bullish weather narrative or reintroduce concerns about adequate supply.
