Where is cocoa cultivation headed in the next two years?

The world cocoa crop faces significant challenges that are shaping its immediate future. Factors such as climate change, plant diseases and fluctuations in demand are affecting both cocoa production and prices.

Production and Supply:

West Africa, especially Côte d’Ivoire and Ghana, continues to be the leading cocoa-producing region, contributing approximately 75% of world production. However, these areas are experiencing declining yields due to aging plantations, diseases and adverse weather conditions. These difficulties have led to a reduction in global cocoa supply.

Demand and Consumption:

Despite production challenges, demand for cocoa and cocoa products, such as chocolate, continues to increase, especially in emerging markets in Asia and in organic and high quality product segments. This increase in demand, combined with the decrease in supply, has contributed to a significant increase in cocoa prices.

Price Trends:

In recent months, cocoa prices have reached record levels. For example, between January and April 2024, the forward price increased by $7,513, reaching an all-time high of $11,722 per ton, representing an increase of 178.5% in just four months. Although there was a subsequent correction, prices remain high.

Outlook for the Next Two Years:

Production challenges, such as adverse weather conditions and plant diseases, are anticipated to persist in the near term. Without significant improvements in production in the next 2-3 years, cocoa could become a scarce commodity, which would keep prices high.

In summary, the cocoa crop faces a period of uncertainty, with limited supply and growing demand likely to keep prices high in the near future.

To learn more about the current trends in the cocoa market, please see the following analysis:

https://www.youtube.com/watch?v=iccDr9F_4sY