Cocoa Market Report – Friday, 31 October 2025

Market Overview

Cocoa futures ended Friday sharply higher, rounding off October with renewed upward momentum driven by supply worries, geopolitical uncertainty, and speculative short covering. New York December settled at $6,141, up $93 (+1.54%), while London December closed at £4,413, up £84 (+1.94%). Prices surged early in the session, testing $6,358 in New York and £4,583 in London before consolidating into the close.

The rally was spurred by expectations of a weaker finish to the main crop in West Africa, continued political unrest in Cameroon, and growing anticipation of cocoa’s reintroduction into the Bloomberg Commodity Index next year. While speculative buying returned, much of Friday’s strength reflected short covering from funds who had built heavy short positions in recent weeks.

Inventory / Certified Stocks

Certified stocks continued to decline across both exchanges, consistent with the tightening physical balance.

• US certified stocks: 1,815,627 bags (−4,181 day-on-day)
• UK certified stocks: 473,750 tonnes (−4,844 day-on-day)

Both markets saw steady withdrawals through the week, reflecting persistent interest in nearby cover. The decline aligns with weaker arrivals in Côte d’Ivoire and Ghana and the ongoing drawdown in certified supplies held at key delivery points.

Futures / Market Metrics

Total trading volume rose sharply to 41,856 contracts in New York and 23,769 in London. March 2026 now leads open interest, reflecting the rollover from the expiring December contract.

The futures curve remains in mild contango, with March trading roughly $109 and £76 above December, respectively. This forward structure signals that while near-term supply tightness persists, traders do not yet foresee an imminent shortage. Commercial hedging and the gradual replenishment expected from the midcrop are helping to maintain structure, though nearby premiums remain firm.

Ivory Coast and Ghana Supply Situation

Crop analysts at Tropical Research Services (TRS) reiterated that both Côte d’Ivoire and Ghana will likely experience a weak end to the 2024/25 main crop. TRS continues to forecast Côte d’Ivoire’s output at 1.75 million tonnes and Ghana’s at 500,000 tonnes but indicated that both could be revised lower if rainfall levels ease prematurely during November.

Recent rainfall in both countries has normalized after several weeks of erratic distribution. Moisture is now better spread across central and eastern cocoa-growing regions, supporting pod filling and maintaining healthy soil moisture. However, logistical delays persist in several Ivorian districts, where heavy showers have slowed drying and bean transport to ports.

Policy and Industry Developments

In Cameroon, political unrest intensified following reports that opposition leader Issa Tchiroma Bakary was escorted to safety by loyal soldiers after the disputed presidential election. The move signaled potential divisions within the armed forces and added uncertainty to cocoa exports from the world’s fifth-largest producer. Traders remain alert to possible disruptions at the Douala port and inland transport routes if protests extend into November.

In Ghana, the government launched its most comprehensive mining industry audit in a decade, targeting major operators including Newmont, AngloGold Ashanti, and Gold Fields. Although the audit concerns the gold sector, it reflects broader government efforts to improve fiscal oversight and revenue management across commodities, which may indirectly influence cocoa-sector liquidity and export financing.

Colombia Cocoa Production

Colombia’s cocoa output rose 1.04% year-on-year in January–September 2025 to 44,158 tonnes, according to Fedecacao, compared with 43,700 tonnes a year earlier. September production was 3,038 tonnes, up from 2,699 tonnes in the same period of 2024. The highest monthly output was recorded in January at 10,529 tonnes.

If current trends continue, Colombia could reach an annual total of approximately 58,877 tonnes in 2025, below last year’s 67,678 tonnes but with higher yields expected in the final quarter. The increase highlights steady regional expansion in fine-flavor cocoa supply from Latin America, helping marginally offset deficits in West Africa.

Weather Conditions

Light to moderate rainfall was recorded across West Africa, with improved distribution compared to early October. Conditions are favorable for late pod filling but are slowing drying and transport activities. The short-term forecast points to continued scattered rainfall through early November, which could delay harvesting in some districts.

Meteorological agencies also highlight stable conditions across Ghana’s Western North, Ashanti, and Central regions and Côte d’Ivoire’s Soubre and Daloa areas. These regions are reporting adequate soil moisture with no major crop stress, though persistent humidity could increase the risk of fungal disease if the rains extend further into November.

Harmattan Risk Forecast

Seasonal models suggest a moderate Harmattan event for the 2025/26 season, beginning between mid-November and early December. Current forecasts indicate below-average dust intensity and near-normal dryness, consistent with neutral ENSO conditions in the Pacific. This outlook suggests that while the Harmattan may briefly reduce humidity and aid drying during December, it is unlikely to cause severe pod desiccation or widespread tree stress.

However, meteorologists warn that even a short burst of stronger-than-expected Harmattan winds in December could rapidly deplete soil moisture in recently reflowered areas, especially in the central Ivorian and southern Ghanaian cocoa belts. Market participants will closely monitor satellite data and ground observations for early confirmation of onset strength over the next two weeks.

Commitment of Traders (COT)

The latest ICE Futures Europe COT report (as of 28 October) shows Managed Money maintaining a large net short position, though with minor covering ahead of month-end. Managed Money longs total 8,183 contracts versus 22,670 shorts, leaving a net short of around 14,487. This structure reflects persistent fund skepticism regarding demand recovery but provides ample room for sharp upward corrections if fundamentals tighten further.

Swap Dealers remain balanced, while Producers and Merchants continue to hedge actively on the short side, consistent with forward sales from West African exporters. The US COT report was not published due to the ongoing US government shutdown, temporarily limiting visibility into speculative positioning on the New York exchange.

Outlook

Prices remain confined within the broader October range of $5,630–$6,480 in New York and £4,200–£4,580 in London. Friday’s rebound restored bullish sentiment but did not yet signal a clear breakout. With certified stocks falling, Cameroon tensions escalating, and the Harmattan approaching, the near-term bias remains constructive. Volatility is expected to increase in early November as traders reposition around crop updates and new weather data.

Weekly Summary Box

Interpretation:
Week-on-week, cocoa futures closed slightly lower despite Friday’s strong recovery. Certified stocks continued to contract, reinforcing the physical tightness theme. The curve’s mild contango indicates no imminent supply squeeze but signals a market still well-supported by fundamentals. Speculative sentiment in London remains net short, leaving potential for a short-covering rally if West African arrivals fall further or Harmattan conditions deteriorate. Cameroon’s instability and steady demand from grinders underpin the bullish medium-term outlook.

Market Interpretation Note

Speculative activity in late October reflected a cautious but stabilizing tone. Managed Money funds remain heavily short in London, leaving the market vulnerable to upward bursts driven by covering rather than new buying. The broader structure still reflects physical tightness masked by subdued trading liquidity.

Weather normalization across Côte d’Ivoire and Ghana is providing temporary relief, but traders remain alert to Harmattan risk and Cameroon’s volatile political backdrop. With certified stocks declining and cocoa’s return to the Bloomberg Commodity Index set for 2026, institutional interest is expected to gradually rebuild. In the short term, range trading is likely to persist, but the underlying setup remains fundamentally bullish into the first quarter of 2026.