Daily Cocoa Market Report (28 Jan 2026): Cocoa Volatility Driven by Policy Failures as Ghana and Côte d’Ivoire Struggle to Clear Stocks

West African cocoa markets remain under severe strain as the sharp collapse in international futures prices collides with rigid domestic pricing and fragile financing structures, triggering widespread disruptions to cocoa purchasing and exports. According to CRA estimates, unsold and uncovered cocoa outside Côte d’Ivoire is approaching 100,000 metric tons, while Bloomberg reports that farmers in Ghana alone are currently holding around 150,000 tons of unsold cocoa. Sales at origin are expected to remain active during any price recoveries, which should act as a limiting factor on further upside.

In Ghana, the crisis has evolved into a financing and governance breakdown. The Ghana Cocoa Board (COCOBOD) and the finance ministry are in active discussions over whether to cut the farmgate price paid to farmers or subsidize purchases to bridge the widening gap between domestic prices and international futures. Ghana currently pays 58,000 cedis per ton (approximately $5,340), well above New York cocoa futures, which have fallen more than 60% from the late-2024 peak near $13,000 per ton. Until a policy decision is reached, COCOBOD has paused purchases, having already bought approximately 500,000 tons of cocoa since the season began in August, against a full-season target of 650,000 tons.

The disruption has been exacerbated by the failure of a recent self-financing experiment, which left farmers unpaid and exposed deep structural weaknesses in Ghana’s cocoa marketing system. As a result, COCOBOD is now open to alternative financing options, including a return to international syndicated loans, according to Reuters and Bloomberg. In parallel, international licensed buying companies (LBCs) have largely stopped buying cocoa for roughly two months, citing unpaid deliveries and frozen financing lines. With international LBCs suspending pre-financing to their local counterparts, cocoa has become effectively immobilised at farm level, amplifying domestic congestion and delaying export flows.

Côte d’Ivoire is facing a similar, though institutionally distinct, set of challenges. Exporters are struggling to fulfill forward contracts agreed with the regulator at the top of the market, prompting the Coffee and Cocoa Council (CCC) to intervene directly. The CCC has announced plans to purchase approximately 100,000 tons of cocoa from farmers, supported by efforts to secure a 280 billion CFA franc ($500 million) financing facility. In addition, industry sources report that operations to remove residual cocoa stocks held by farmers are set to begin imminently. Official estimates place these residual stocks at around 123,000 tons, though several market participants believe the true figure may be significantly higher, reflecting poor visibility over cocoa volumes effectively trapped inland.

These stock-removal operations are intended as an emergency measure to ease domestic congestion, restore a minimum level of liquidity for farmers, and gradually revive port arrivals at Abidjan and San Pedro. However, multiple observers caution that any improvement in flows may prove temporary and artificial if deeper structural constraints, including financing capacity, coordination across the value chain, and market governance, are not addressed. Delays or operational bottlenecks could prolong the marketing crisis and further undermine farmer confidence.

Weather developments add a secondary layer of complexity. CRA reports that rainfall across Côte d’Ivoire and Ghana has declined, while the Harmattan wind has intensified over the past week, reaching strengths comparable to last season. However, because the Harmattan strengthened relatively late in the season and was mild through December and early January, crop damage is expected to be limited. CRA observes similar conditions in Nigeria. TRS anticipates a gradual recovery in harvest activity, particularly in Ghana, though it continues to report no significant improvements in plantation management. Looking ahead, TRS forecasts a global cocoa surplus of 100,000 to 150,000 tons for the 2025/26 season, marking a sharp contrast with the extreme tightness priced into the market just months ago.

Overall, the current situation reflects structural dysfunction rather than physical scarcity. Emergency stock removals, state-backed purchases, and temporary financing solutions may stabilise flows in the near term, but market participants widely agree that without reforms to domestic pricing mechanisms, financing structures, and supply-flow anticipation, volatility will remain elevated. Under current conditions, any price rebound is likely to be policy-driven, fragile, and vulnerable to renewed breakdowns, leaving cocoa markets caught between political intervention and financial reality.

Futures Performance

ICE US Cocoa Futures (CC)

US and London cocoa futures posted a sharp and synchronized reversal on 28 January, fully unwinding the prior day’s rebound. ICE US contracts fell between 5.7% and 6.2%, with the steepest percentage losses concentrated in the front of the curve, indicating aggressive liquidation rather than selective profit-taking. The absence of front-end resilience suggests that the 27 January rally was largely technical in nature and lacked follow-through buying support, leaving the market vulnerable to renewed selling pressure.

ICE London Cocoa Futures (C)

In London, losses were similarly severe but showed a clear tapering into the deferred months, with declines easing from -6.2% in Mar-26 to just over -5.2% in Dec-26. This curve behavior points to near-term risk reduction rather than a deterioration in longer-dated supply expectations. The parallel magnitude of declines across both exchanges confirms a macro-driven risk-off move, reinforcing elevated volatility conditions rather than signaling a structural shift in the broader cocoa bull trend.

Contango / Backwardation

The persistence of contango across both US and London cocoa curves underscores that the current stress is rooted in financing and market-structure distortions rather than immediate physical scarcity. Deferred prices reflect expectations of supply normalization once policy and funding constraints are resolved, while nearby contracts remain pressured by uncertainty and forced liquidation. This structure cautions against interpreting recent price declines as a collapse in end-user demand or a sudden improvement in global supply conditions.

US–UK Spread

4,146 − (2,896 x 1.380$/£) =$149/ton (up from $146/ton)

Volume & Open Interest

ICE US Cocoa Futures (CC)

US cocoa futures saw moderate-to-elevated volume on 28 January at 35,118 contracts, slightly above the 27 January level and in line with recent session averages. Importantly, open interest was already elevated and rising into the sell-off, increasing steadily from 139,617 on 14 January to 149,397 on 27 January, before the 28 January OI update (not yet published). This pattern strongly suggests that the sharp price decline occurred against a backdrop of heavy positioning, pointing to long liquidation and forced risk reduction, rather than a thin-market air pocket. The fact that volume expanded while prices fell sharply reinforces the interpretation of a position-clearing event, not a lack of liquidity.

ICE London Cocoa Futures (C)

In London cocoa, volume on 28 January rebounded to 31,379 contracts, up from 25,266 on the 27th, while open interest had been consistently building into the move, reaching 168,497 contracts on 27 January, the highest level in the period shown. The combination of rising open interest ahead of the decline and increased turnover during the sell-off indicates that speculative length was being actively unwound, rather than new shorts aggressively pressing the market. Overall, volume and open interest dynamics across both exchanges confirm that the price action reflects a violent deleveraging phase within a crowded market, consistent with elevated volatility but not yet indicative of structural trend exhaustion.

Certified Inventory Stocks

Despite the severe disruption to cocoa purchasing at origin, these bottlenecks have not yet translated into a meaningful acceleration in ICE certified stock draws. Certified inventories in both the US and UK continue to decline only marginally, reflecting a combination of policy-driven export delays and subdued grind demand following the period of extreme price volatility. This disconnect between inland congestion, cautious consumption, and exchange stocks is contributing to unstable price discovery, as futures markets struggle to reconcile physical dysfunction with the absence of immediate certified shortages. Subdued grind demand has reduced the urgency to draw certified stocks, reinforcing contango even as origin logistics remain impaired.

What to Expect Tomorrow

Price action across intraday, daily, and weekly charts suggests the market enters the next session in a fragile stabilization phase, not yet a confirmed base. On the 5-minute and hourly charts, selling momentum has slowed and price is consolidating around 4,140–4,180, indicating short-term exhaustion after the sharp liquidation. However, momentum indicators (RSI hovering below neutral, MACD still negative) show no bullish reversal signal yet, implying that any early rebound attempt is likely to be technical and vulnerable to renewed selling rather than trend-changing.

From a higher-timeframe perspective, the daily and weekly structures remain decisively bearish. The daily chart shows a clear breakdown from the prior consolidation zone, with volume expanding into the decline and OBV continuing to trend lower, evidence that distribution is ongoing. Weekly momentum remains negative, with RSI below mid-range and MACD deep in bearish territory, signaling that the broader corrective phase is not complete. For tomorrow, the most probable scenarios are either range-bound trade with a downside bias or another probe lower if selling pressure re-emerges, while a sustained recovery would require a clear reclaim of the 4,250–4,300 zone, which currently looks unlikely without a catalyst.

Speculative funds remain net short cocoa in both New York and London, leaving the market acutely sensitive to policy headlines and financing developments in West Africa. In this environment, any announcement related to state-backed purchases, syndicated financing, or the resumption of exports could trigger sharp short-covering rallies, even if underlying fundamentals remain weak. This positioning asymmetry helps explain the market’s recent pattern of violent rebounds followed by rapid failures, reinforcing elevated volatility rather than directional conviction.

If you notice any discrepancies in these figures or have extra information, please email hello@cocoaintel.com or leave a comment – corrections and additional insights are always welcome.