13.11.2025 - Daily Cocoa Market Report

New York cocoa extended its slide on Thursday, with the March contract closing at $5,609, down about $130 (-1.8%) on the day and roughly $489 (-8%) lower for the week. Prices sit decisively below the 10, 20, 50 and 200-day moving averages and under the lower Bollinger Band around $5,625, with daily stochastics firmly in oversold territory. The tape is classic trend-following: every push back toward the moving averages has been sold, not bought, and the small upside gap on the March chart between $6,377 and $6,390 still looks like a magnet for sellers rather than an invitation for bulls.

London cocoa followed in the same direction, but with a different tone. The correct UK March contract closed at £4,132, which converts to roughly $5,440 at current FX rates. That means New York is now trading at about a $169 premium over London — the normal structure, and the opposite of the London premium that appeared when the incorrect price was used. The NY premium reflects a mix of tariff expectations, stronger speculative flows in the U.S. contract, and the fact that New York bears absorbed the bulk of the macro-driven selloff this week.

Technically, London is also under pressure, trading below its short- and medium-term moving averages, but the cross-market relationship has snapped back into its usual alignment. London is still weaker than New York, but it is falling at a slightly slower rate. This indicates that the heaviest bearish momentum remains concentrated in the U.S. contract, where the tariff narrative and macro liquidation have combined to push prices sharply lower.

Volume and positioning confirm this is not a lazy drift lower. Total ICE U.S. cocoa volume on 13 November reached 42,155 lots, following an even heavier 44,557 lots the previous day — both above the 31–40k range that dominated earlier in the month. The down-move is being executed with size, not on thin air. Between 7–12 November, open interest increased by 5,266 lots, consistent with fresh short-selling as the market broke support.

In London, volume has also expanded: daily turnover rose from the mid-20k range at the start of November to 36–37k lots on 11–12 November, followed by a still-strong 31,294 lots on the 13th. Both exchanges are sending the same message: bears are active, disciplined, and well-financed.

Technical Structure & Spreads

• NY–London March Spread:
  • NY March: $5,609
  • UK March USD-equivalent: ≈ $5,440
  • Spread: NY is now ~$169 premium over UK.

Total NY volume: 42,155 lots
London volume: 31,294 lots

Exchange Stocks

• US stocks (Thu): 1,770,278 tonnes
• US stocks (Wed): 1,783,757 tonnes
• Change: –13,479 tonnes (a modest drawdown)
• UK stocks (Thu): 532,656 tonnes
• UK stocks (Wed): 532,656 tonnes
• Change: 0 (flat)

Interpretation:
Exchange stocks back up that complacency on nearby supply. Certified inventories stand around 1,770,278 tonnes in the US and 532,656 tonnes in the UK – comfortable levels by recent standards. No one is panicking about running out of beans in the next few months; instead, the fear has flipped to “what if we drown in supply in 2026–27?” Rabobank’s new report leans into that narrative, projecting a cocoa surplus of about 328,000 tonnes in the current crop year and 403,000 tonnes in 2026–27 as Latin America and Indonesia expand acreage and output at the same time as demand remains soft. They explicitly warn that over-planting could trigger a price collapse as soon as 2027 if consumption doesn’t catch up.

West Africa Supply & Origin Developments

West African fundamentals are messy in a different way. A ModernGhana report puts cocoa lost to smuggling in Volta and Oti alone at 7,128 tonnes between 2020 and 2025, with COCOBOD estimating about US$1.1 billion in lost revenue from beans siphoned to Togo and Côte d’Ivoire over recent years. To fight back, COCOBOD is now promising to reward whistleblowers with one-third of the value of any contraband confiscated, a very aggressive incentive structure designed to blow up smuggling networks. This doesn’t change global availability – the beans still hit the world market – but it wrecks Ghana’s balance sheet and erodes its capacity to fund replanting, disease control and extension services. The long-term read is bearish for Ghana’s official production capacity, even if it’s neutral for global tonnage in the short run.

Climate Watch – Weak La Niña / Harmattan Risk

Weather and climate risks are not gone; they’re just being ignored for now because the surplus story is louder. The US Climate Prediction Center and the Reuters weather line both confirm that La Niña is expected to linger through the Northern Hemisphere winter, with a transition back to ENSO-neutral most likely in January–March 2026 and odds around 60-plus percent. This is a weak La Niña, not a monster event, but even a weak one tends to tilt West Africa slightly drier than normal in December–February. That raises the probability of soil-moisture deficits, Cherelle wilt and pod abortion, all of which can chip away at yields for the 2025/26 main crop. The real wild card is how La Niña interacts with the Harmattan: if the seasonal north-easterlies turn out stronger, dustier or longer-lasting than normal, you get pod shrivel, smaller beans, more defects and potentially delayed exports. For now, daily weather is benign – Maxar notes scattered showers and conditions “favourable for harvesting” – so funds see no reason to re-price weather risk yet

Policy & Macro

The macro and policy backdrop has flipped from threatening to more benign, which paradoxically is another reason prices are falling. In Washington, the government shutdown has been resolved, with funding secured until 30 January, so CFTC Commitments of Traders data should start flowing again. More importantly for cocoa, the US has agreed framework trade deals with Argentina, Ecuador, Guatemala and El Salvador that will remove tariffs on some food and other imports, explicitly aiming to lower prices for coffee, bananas and other tropical foodstuffs. Cocoa is not spelled out line by line in the press release, but it sits in exactly the same “we don’t grow this stuff domestically” bucket. The direction of travel is obvious: friendlier access for Latin American exporters, especially Ecuador, into the US market, and less policy risk on the import side. That’s bearish for the price level of the dollar contract – cheaper landed beans – but mildly bullish for long-term demand, because chocolate makers get some relief from the tariff plus high-price double squeeze. West Africa, of course, is not included in these frameworks, which means its relative position into the US worsens unless separate preferences are negotiated.

Industry Developments

On the demand and processing side, there are some medium-term positives hidden behind the current sell-off. Barry Callebaut has just opened a US$104 million chocolate factory in Brantford, Ontario – its third in Canada and its largest capital investment in North America to date – adding new capacity for liquid chocolate and molded products plus integrated warehousing. You do not build that kind of plant if you think chocolate consumption is about to disappear. It’s a clear signal that, at a strategic level, the industry still believes in robust North American demand once prices stabilise, even if short-term grind data have been weak.

StoneX added another layer to the fundamental picture, noting that while some analysts expect a better 2025/26 harvest, their own contacts are far less optimistic. According to StoneX, several origin-side and industry sources are not seeing evidence of a meaningful production rebound for the upcoming season.

More importantly, the firm says the consensus across the trade for the next two quarters is a decline in milling. That aligns with the broader demand malaise we’ve been tracking: grinders remain reluctant to lock in volumes at elevated raw-bean prices, especially with tariff uncertainty still hanging over the supply chain and chocolate manufacturers reporting weak throughput.

Seasonality & Flows

Mid-November is historically not a strong period for cocoa.
Funds typically sell weakness here, and with COT returning, a net-short expansion is likely.

Market Interpretation

For the very short term – the next session or two – the bias remains clear: the path of least resistance is still down, and any bounce toward the broken moving averages on March looks like a sell, not a buying opportunity, unless we suddenly see a genuine weather scare or a sharp tightening in spreads. With options on the December New York contract expiring and first notice just a week away, expect more noise from position-squaring around key strikes, but don’t confuse that with a change in the underlying trend. Until stocks start to fall, weather flips from “fine” to “problem,” or policy headlines turn hostile instead of friendly, the market will keep treating cocoa as a sell-the-rally, not buy-the-dip story.

What to Expect Next Session

• Technical bias remains bearish; rallies into the low $5,700s on March likely meet sellers.
• Watch for options expiry noise (Dec NY options expire tomorrow).
• No weather triggers expected overnight; fundamentals still comfortable.
• Any headlines confirming cocoa-specific tariff relief would add further downside pressure.
• If COT shows funds still have room to expand shorts, momentum can accelerate.

Bias for next session: still lower, with intra-day bounces viewed as selling opportunities.