World: Cocoa prices fell sharply due to improved production forecasts

Published 2024년 7월 31일

Tridge summary

Cocoa prices have seen a significant drop due to improved production forecasts in West Africa, particularly in Ivory Coast and Ghana, as expected rainfall increases with the end of the El Niño regime and the beginning of La Niña. This situation is expected to boost cocoa yields, which helps explain the price decline. However, high cocoa prices are starting to reduce demand and slow down processing, and increased exports from Nigeria are also putting downward pressure on prices. Despite these factors, reduced production in Côte d'Ivoire and decreased supplies to the US are helping to keep prices at a certain level, as they offset the increased production in other regions. Additionally, concerns about the average harvest in West Africa and higher-than-expected global demand are supporting prices, contributing to a complex balance between supply and demand.

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

Original content

Cocoa prices fell sharply on Monday. September cocoa futures on ICE NY (CCU24) closed down 4.01%, while ICE London #7 (CAU24) closed down 2.87%. The reason for this was an improvement in the forecast for cocoa production in West Africa, where rainfall is expected to increase due to the end of the El Niño regime and the transition to the La Niña regime. This will increase cocoa yields in countries such as Ivory Coast and Ghana. Expectations of a prolonged period of high cocoa prices are also putting pressure on prices, which could reduce demand and slow cocoa processing. Rising cocoa exports from Nigeria, the world's fifth-largest producer, are also weighing on prices. In June, exports increased by 18% to 14,465 tons. A forecast by Ghana's cocoa regulator to increase production to 700,000 tonnes in 2024/25 from 425,000 tonnes in 2023/24 is also helping lower prices. However, reduced production in Côte d'Ivoire and reduced supplies to the US are keeping prices at a certain level. In ...

Source: Landlord