Global: Cocoa market registers an increase in prices with demand recovery and low production forecast

Published Aug 6, 2024

Tridge summary

Cocoa prices on the futures market surged due to a combination of factors, including short covering, lower production in Ivory Coast, and potential disease risks in cocoa plantations. The market initially experienced a dip due to concerns over global demand and supply, exacerbated by Hershey's reduced sales forecast. However, increased cocoa exports from Nigeria and low cocoa stocks in the United States supported the price recovery. For the 2023/24 season, Ivory Coast projects a significant drop in cocoa production, while Ghana's production is expected to recover. Demand for cocoa has been stronger than anticipated in various regions. The International Cocoa Association warns of a deficit and a significant decline in global cocoa production, pointing to a volatile price outlook for the market.

Disclaimer: The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

This Monday, cocoa prices on the futures market rose significantly. September ICE NY Cocoa (CCU24) saw an increase of +369 (+4.91%), while September ICE London Cocoa #7 (CAU24) rose +260 (+4.32%). This recovery comes after a period of falling prices, reaching one-month lows due to concerns about the global demand and supply scenario. Influences on Price Recovery The price recovery was driven by short covering, mainly due to lower cocoa production in Ivory Coast, the world's largest producer. Government data indicated that from October 1 to August 4, cocoa shipments to ports totaled 1.66 million metric tons (MMT), a 28% drop compared to the same period last year. Prices initially fell due to concerns about global demand, especially after Hershey, the world's fourth-largest chocolate producer, reported a quarterly drop in sales and revised its annual forecast downward due to weakening consumer demand for chocolate. Climatic Conditions and Production The outlook for the upcoming ...

Source: Mercado Do Cacau