FX.co ★ Cocoa Futures Hover Around 2023-Lows

Cocoa futures are trading in a tight band around $3,400 per tonne, hovering near their lowest levels since 2023, as markets weigh expectations of ample supply against signs of muted global demand. On the supply side, weather conditions have generally improved in key West African producers, including Ivory Coast and Ghana, bolstering the outlook for higher production. Even so, irregular rainfall in Ivory Coast’s main cocoa-growing regions is beginning to unsettle the global market, coming at a critical stage in the development of the mid-crop, which runs from March to August. Harvesting is still under way, and farmers report solid pod development that should support output in the near term, particularly in May and June. However, if the dry spell persists, it could eventually curb yields and undermine bean quality later in the season. On the demand side, the latest grinding data point to continued weakness, with both Europe and the United States still reporting declines.