Cocoa Rebounds on Short Covering as Supply Risks Persist (April 28, 2026)

• Cocoa futures rose on Apr-28, with New York and London both gaining about 2.4%, recovering part of the prior session’s losses
• Expana sees mixed West African crop outlook
• El Niño risk could further disrupt output, particularly in Ecuador
• Mondelez beat Q1 revenue expectations, pointing to resilient chocolate demand despite high cocoa costs
• Ivory Coast farmers face fertilizer shortages due to weak incomes and high input costs

Cocoa futures closed higher on 28-Apr, with New York Jul-26 gaining around +2.4% and London Jul-26 up approximately +2.4% as well, recovering part of the previous session’s sharp losses. Price action during the day reflected a gradual recovery early on, followed by loss of momentum and sideways consolidation into the close. The market moved higher initially as selling pressure faded, but upside follow-through was limited, with gains stabilizing rather than extending.

The overall tone of the session was one of controlled recovery rather than strong buying conviction. After the initial push higher, price action became more balanced, with neither side able to take control. This resulted in a relatively narrow trading range for most of the session, indicating that the rebound was driven more by short covering and position adjustment than by fresh directional flows.

West Africa Crop Outlook Remains Mixed

Expana’s latest assessment highlights a mixed outlook across the main West African producers, with conditions diverging between Ghana and Côte d’Ivoire. In Ghana, crop development remains relatively favorable, supported by a solid pod set that suggests the mid-crop should finish well and that the transition into the main crop will be broadly normal. By contrast, conditions in Côte d’Ivoire appear less encouraging, with weaker pod formation raising concerns about the potential of the upcoming main harvest.

At a broader level, expectations for large crops in both countries are increasingly constrained. Expana points to a range of structural issues that continue to weigh on production potential, including the spread of swollen shoot disease, insufficient upkeep of plantations, and ongoing challenges around farmer economics such as low farmgate prices and delayed payments. These factors, combined with limited long-term investment in the sector, reduce the likelihood of achieving historically high output levels.

Looking beyond West Africa, additional risk comes from weather dynamics, particularly the possible development of El Niño conditions, which could disrupt production in Ecuador. Taken together, these elements reinforce the view that global cocoa supply is likely to remain tight, even if current futures pricing has yet to fully reflect these underlying constraints.

Strong Demand Signals from Mondelez

Mondelez International reported stronger-than-expected first-quarter results, supported by resilient demand for its chocolate and biscuit products. The company posted net revenues of $10.10 billion, surpassing analysts’ expectations of $9.75 billion, according to LSEG data.

The performance suggests that, despite elevated cocoa prices and broader cost pressures, consumer demand for confectionery remains relatively robust. This indicates that pricing power across major manufacturers is still holding, allowing companies like Mondelez to pass through higher input costs without significantly impacting sales volumes.

This reinforces the view that end-user demand remains stable, particularly in key consuming markets. Strong earnings from a major player such as Mondelez point to continued grind demand resilience, which can act as a supportive factor for cocoa prices, even as futures markets currently reflect a more neutral structure.

Farmers in Côte d’Ivoire, the world’s largest cocoa producer, are facing increasing difficulty securing fertilizer, raising fresh concerns about future crop potential. A recent survey shows that a significant majority of farmers have not yet purchased fertilizer for the next two production cycles, highlighting the strain on input availability at a critical point in the growing season.

Ivory Coast Fertilizer Shortage Raises Supply Risks

The issue is being driven by a combination of weak farmer economics and rising input costs. Lower cocoa prices over recent months have reduced farm incomes, while fertilizer prices remain elevated, leaving many producers unable to afford necessary inputs. As a result, application rates are expected to fall, directly impacting yields in the upcoming seasons.

Weather risk further compounds the problem. The potential development of El Niño conditions introduces the likelihood of heat stress and irregular rainfall, both of which can reduce productivity. When combined with insufficient fertilizer use, the impact on output could be amplified, increasing the downside risk to production.

Early estimates already point to a decline in Ivory Coast output this year, with expectations of further pressure into the next cycle. The situation is particularly sensitive given the country’s central role in global cocoa supply. Any sustained reduction in yields would tighten the global balance, reinforcing concerns that supply constraints could persist beyond the near term.

Futures Performance

New York Cocoa (CC)

New York cocoa futures posted a controlled but structurally meaningful rebound on 28-Apr. The recovery remains front-led, but the gradient is relatively shallow: Jul-26 outperformed Mar-27 by ~50 bps, which is materially less aggressive than the prior session’s selloff profile. This matters because it suggests the move was not a full re-pricing of front-end tightness, but rather a partial short-covering cycle layered onto a still-fragile curve.

London Cocoa (C)

London cocoa futures exhibited a more symmetric recovery profile, with only a mild front-end bias. The spread between May-26 and Mar-27 performance is ~70 bps, but most of that is concentrated in the front contract, while Jul–Sep trade almost identically. This reflects a market that is less position-stressed and more driven by systematic re-risking rather than forced flows.

EFP, EFS and Spread Activity

EFP and EFS flows were broadly consistent with a stabilization phase after the prior liquidation. In New York, EFP activity remained steady, reflecting routine hedge adjustments by physical players rather than stress-driven flows. The persistence of contango continues to support these transactions, as it enables carry and financing structures. There was no sign of basis dislocation, indicating that physical–futures alignment remains orderly.

EFS activity was relatively light, with flows suggesting tactical rebalancing between New York and London rather than large arbitrage positioning. With both markets moving in parallel and maintaining similar curve shapes, cross-market opportunities appear limited, and participation remained measured.

Spread activity showed modest front-end tightening in New York, consistent with the slight outperformance of nearby contracts. However, the move was contained and insufficient to alter the overall contango structure. London spreads were largely stable, reinforcing the view of low positioning stress and a balanced recovery.

US–UK July Spread

$3,365 − (£2535 x 1.352$/£) =$-62ton (up from $-64)

The NY–London arbitrage continues to show London trading at a premium to New York. This is a notable outcome because, structurally, the arbitrage remains inverted versus typical flow expectations.

Volume and Open Interest

New York Cocoa (CC)

Volume patterns in New York cocoa futures show a clear contraction in activity into the end of the period, consistent with a market moving out of a high-volatility phase. After peaking on 14-Apr at 126k lots, volumes trended lower, stabilizing in the 20–30k range. On 27-Apr, volume was 33k, dropping further to 24,970 on 28-Apr, despite the price rebound. This divergence: higher prices on lower volume, suggests that the recovery lacked strong participation and was likely driven by short covering rather than fresh buying interest.

Open interest in New York provides additional context. It remained broadly stable throughout the period, fluctuating around 195k–197k lots, with a slight uptick to 197,506 on 27-Apr. The absence of a meaningful drop in open interest during the selloff, followed by no clear build on the rebound, indicates that positions were adjusted rather than aggressively unwound or initiated. This reinforces the interpretation of a rebalancing phase, where the market is cleaning up positioning without committing to a new directional trend.

London Cocoa (C)

In London, volumes follow a similar but more muted trajectory. Activity peaked mid-month (44k on 14-Apr) and then declined steadily, with 22,437 on 27-Apr and 19,721 on 28-Apr. The continued drop in volume alongside a price recovery again points to limited conviction behind the move. Market participation appears to be thinning, suggesting that recent price action is not being driven by broad-based engagement.

Open interest in London, however, shows a gradual and consistent build, rising from ~220k to 231,535 by 27-Apr. This steady increase, even as volumes decline, indicates ongoing accumulation or rolling of positions, likely by commercial participants. Unlike New York, where OI is flat, London shows structural participation building in the background, though not in a way that is immediately price-disruptive.

Exchange Trading Volume

These figures refer only to ICE Deliverable Stocks (Exchange-Visible)

Readers can explore detailed cocoa market datasets, futures statistics, and historical indicators in the CocoaIntel Data Hub:

Data

📊 Grindings 📦 Inventory / Certified Stocks 🚢 Import / Export Flows ⚖️ Stock-to-Grind Ratio 📈 Futures Contracts 🔄 Futures Curve & Spreads 🧠 COT / Positioning 🚚 Port Deliveries 🌧️ Weather Dashboard 🌀 Options & Volatility 📅 Seasonality 📑 Institutional Reports 🗓️ Cocoa Calendar This section is currently under active development. We are building a structured, transparent cocoa market data platform covering futures analytics, certified stocks, positioning

CocoaIntelCocoa Intel

What to expect tomorrow

For tomorrow, the setup points to range-bound trading with a slight downside bias. The market is consolidating after the rebound, with price struggling to build momentum above the 3400–3450 area and no strong volume confirming upside continuation. Intraday action is likely to remain choppy, with rallies likely to be sold into and price contained roughly within the 3320 to 3420 range. A break below 3300 would open the way for further weakness, while only a sustained move above 3450 would shift the tone more constructively.

More broadly, cocoa has been in a consolidation phase for nearly two and a half months, with price oscillating within a defined range after the earlier decline. These prolonged compression periods typically precede sharp directional moves once a breakout occurs. While there is no confirmed trigger yet, the current tightening in price action suggests the market is building toward a larger move, making the next clean break either below support or above resistance potentially significant.

If you notice any discrepancies in these figures or have extra information, please email [email protected] or leave a comment – corrections and additional insights are always welcome.