COCOA MARKET TRENDS – MARCH 2025

The article contains data provided by Saxobank, Reuters, ICCO, HCCO, Rabobank

1. Season 2024/2025

The cocoa harvest season in Côte d’Ivoire is ongoing, but we are seeing increasingly weaker data on cocoa bean arrivals at the port. As of March 21, a total of 1,427,000.00 tons have been delivered to ports, which is still ahead of last year’s harvesting season. Compared to the previous season, arrivals are 11% higher (though, at the start of the harvest, we were nearly 40% ahead of the previous year). However, there is a clear downward trend in arrivals. Over the past 12 weeks, significantly fewer beans have been delivered to ports compared to the previous year.

The main crop will be better than last year but still not good enough, and we are very likely to see the fourth consecutive year of supply deficit.

The biggest news of the past month is that due to poor weather conditions, Côte d’Ivoire’s summer crop is expected to be at a record low, estimated at 280,000.00–300,000.00 tons, compared to historical averages of over 500,000.00 tons.

The second important update is that Côte d’Ivoire is raising the price of cocoa beans for farmers from 1,800 CFA to likely 2,000–2,300 CFA, an increase of at least 11% is expected. As a result, Côte d’Ivoire will be restricting cocoa bean exports to ensure sufficient supply for domestic processing.

Meanwhile, Ghana will not be able to fulfill its contracted cocoa bean deliveries and has announced that crop failures will result in losses of approximately $1.3 billion.

One would expect this news to drive cocoa prices up, but at the moment, we are actually seeing a decline in market liquidity. Due to significantly higher margin requirements compared to previous periods, the number of speculative positions is decreasing.

According to new forecasts from the ICCO (International Cocoa Organization), after three consecutive years of deficit, we are now expecting a surplus year due to weaker consumption. However, many traders and producers believe that weak data from Côte d’Ivoire and Ghana regarding the mid-crop will likely prevent the market from reaching such optimistic figures, and we will most likely see another deficit year.

Cocoa processing is showing a decline, although the Asian region remains stable and is likely to continue its upward trend. This could potentially prevent cocoa bean prices from falling below current levels. A clear growth trend is emerging in the Asian market.

GEPEX (African cocoa processors) reported only a 0.3% decline from October to the end of February, which we consider to be a relatively strong performance.

The market continues to experience a physical cocoa bean shortage.

Certified stock levels in U.S. warehouses saw a slight increase in March. As of March 21, the number of bags stands at approximately 1,785,000.00 equivalent to around 112,000.00 tons which is a noticeable rise from 90,000.00 tons the previous month but still clearly insufficient.

The cocoa butter ratio is currently at 2.52, reflecting a significant correction from peak levels of over 4 ratio points during the summer of 2024. The actual price remains stable, with a potential slight increase over the next two quarters.

The cocoa liquor ratio stands at 1.65, showing a slight upward trend throughout 2025 year

The cocoa powder ratio is at 1.27, significantly higher than the previous month, leading to an increase in the final product price compared to last month.

As of today, the market price in euros is €7,400.00 per ton.

FOB West Africa Ratios for December 2024 deliveries

Cocoa Liquor

1.65 with a stable upward trend towards 1.8 by Q4 2025. At current market levels, the price for Q2 is expected to be around €12,200.00 per ton.

Natural Cocoa Butter

2.52, with a stable upward trend over the next four quarters, reaching 2.9. At current market levels, the price for Q2 is expected to be around €18,700.00 per ton.

Cocoa Powder

The ratio has remained almost unchanged from the previous month, standing at 1.27 relative to the market.

Natural Cocoa Powder price starts from €9,400.00 per ton

Alkalized Cocoa Powder price starts from €9,650.00 per ton

2. Technical Analysis

The New York market has finally undergone the long-awaited correction, completing the second-wave correction at a lower level than previously expected. However, compared to last month’s forecast, the market followed a relatively clear and correct correction pattern. The previous price growth outlook remains intact.

It is likely that by the end of March, we reached the bottom of the correction in the short term.

Our recommendation to clients remains unchanged: buy any price correction, as it may be short-lived. Given the current market volatility, we could see price swings exceeding $1,000 per day.

Weather

Rainfall levels in West Africa over the past 30 and 90 days have been above average. In the past month, we have observed heavy rains, which should contribute to a strong harvest in late July/August and likely lay a solid foundation for the next main crop.

However, in the short term, excessive rainfall is causing significant damage to the mid-crop of the 2024/2025 season.