Daily Cocoa Market Report (3 March 2026): Cocoa Market Enters Stabilization Phase After Volatility and Farmer Tensions

Ivory Coast authorities have moved to calm tensions in the cocoa sector after farmers raised concerns that the government might halt its programme to purchase surplus cocoa beans during the ongoing mid-crop harvest. The reassurance comes after a sharp decline in global cocoa prices and fears among producers that the support mechanism could be suspended earlier than expected.

The stock-buying programme, designed to provide liquidity to farmers and cooperatives holding unsold cocoa beans, has already absorbed around 23,000 tonnes of cocoa since the start of the suspension initiative, according to the Agricultural Interprofessional Organization for Cocoa (OIA). Officials confirmed that the government remains committed to completing the programme and will continue purchasing the remaining inventories accumulated earlier in the season.

Farmer representatives had warned of potential protests after rumours circulated that the programme might be stopped prematurely. Many producers rely on the initiative to secure cash flow, particularly as the mid-crop harvest progresses and global prices remain volatile. Authorities sought to reassure farmers that all remaining cocoa stocks will be purchased under the existing scheme, helping stabilize incomes and prevent logistical disruptions in the sector.

The dispute emerged as regulators were reportedly considering reducing the farmgate price for the mid-crop, which could fall to between 800 and 1,000 CFA francs per kilogram, down from the current 2,800 CFA francs per kilogram guaranteed under the main crop. Such a reduction would significantly affect farmer revenues and has intensified tensions within the supply chain.

Producer groups have also criticized administrative delays related to the delivery of cocoa stocks to Abidjan warehouses. Some cooperatives claim that the Coffee and Cocoa Council (CCC) refused to validate certain delivery documentation, preventing beans from being transported and sold through official channels.

Despite these concerns, government officials insist that the programme will continue as planned and that the remaining surplus beans will be fully purchased. The move aims to stabilize the domestic cocoa market, support farmer incomes, and prevent potential disruptions to the country’s cocoa supply chain as the mid-crop harvest continues.

Futures Performance

ICE US Cocoa (CC)

The ICE US cocoa curve showed a broad-based upward adjustment between 2 March and 3 March, with all comparable contracts closing higher. The front month Mar-26 increased modestly by 10 points, moving from 2,931 to 2,941. This relatively small gain compared with later maturities suggests that the nearby contract had already absorbed most of the rebound during the prior session following the late-February liquidation event.

Further along the curve, May-26, Jul-26, Sep-26, and Dec-26 all recorded stronger gains ranging from +35 to +39 points. The Jul-26 and Sep-26 contracts led the advance, both rising nearly 40 points. This pattern indicates that the rally was not limited to short-covering in the front month, but rather involved renewed buying interest across the mid-curve, where speculative positioning is typically concentrated.

US cocoa curve remained in contango, with deferred contracts trading progressively higher than nearby ones. Importantly, the spread relationships did not compress significantly, meaning the price increase occurred as a relatively parallel upward shift of the curve rather than a tightening of nearby supply conditions.

The distribution of gains suggests a positioning reset rather than a fundamental repricing of supply. After the sharp liquidation observed on 27 February, the market appears to be stabilizing as participants gradually rebuild exposure. The fact that mid-curve contracts moved more aggressively than the nearby contract supports the view that systematic or fund-driven positioning is returning, rather than physical market participants responding to changes in spot supply.

ICE London Cocoa (C)

The ICE London cocoa market also recorded a positive close-to-close adjustment between 2 March and 3 March, but the distribution of gains across the curve differs noticeably from the US market. The front two contracts led the advance, indicating that the price move was concentrated in the nearby portion of the curve rather than evenly distributed.

The Mar-26 contract increased by 29 points, rising from 2,078 to 2,107. Similarly, May-26 gained 30 points, moving from 2,115 to 2,145. These are the largest absolute increases along the curve and highlight that the market strength was front-end dominated. Such a structure is typically associated with short-covering activity or near-term positioning adjustments, rather than long-term fundamental repricing.

London cocoa curve remains firmly in contango, with deferred contracts continuing to trade at higher prices than nearby ones. Importantly, the spreads did not compress significantly, and there was no sign of curve inversion or squeeze dynamics in the nearby delivery months. If the rally were driven by tightening physical supply, one would normally expect deferred contracts to strengthen more aggressively or the curve to flatten.

Further along the curve, the magnitude of gains declines progressively. Jul-26 rose by 23 points, Sep-26 increased by 14 points, and Dec-26 gained only 9 points. This clear decay in price movement along the curve indicates that deferred contracts did not participate proportionally in the rally. When longer maturities lag behind the nearby months, it generally implies that the move is driven by technical factors or positioning adjustments rather than a structural tightening of future supply expectations.

US–UK May Spread

$3,022 − (2,145 x 1.335$/£) =$158 ton (up from $136/ton)

Volume and Open Interest

ICE US Cocoa (CC)

ICE London Cocoa (C)

The recent cocoa market behavior between mid-February and 3 March indicates a clear positioning cycle rather than a fundamental shift in supply expectations. In both the ICE US and ICE London cocoa markets, open interest expanded strongly between 17 February and 27 February, suggesting that new positions were being added aggressively. In the US contract, open interest rose from 154,642 to 189,401 contracts, while the London contract increased from about 201,267 to over 218,000 contracts before easing slightly. Such rapid expansion in open interest typically reflects new speculative positioning entering the market, and given that prices were weak or unstable during this period, it likely represented a build-up of short positions ahead of the late-February liquidation event.

The 27 February sell-off appears to have triggered forced liquidation, after which the market staged a rebound. By 2 March, the structure changed meaningfully: the US cocoa contract recorded high trading volume of 58,822 contracts alongside a new peak in open interest at 193,236 contracts. When prices rise while open interest also increases, it generally indicates that new buyers are entering the market rather than the move being driven solely by short covering. This suggests that the rebound was supported by at least some fresh long positioning from speculative participants or systematic funds, helping stabilize the market after the earlier liquidation.

However, by 3 March trading activity moderated, with US volume falling to 40,985 contracts and London volume declining to 36,677 contracts. Prices still strengthened slightly, but the reduction in volume implies that the initial momentum of the rebound is already fading, indicating a transition from aggressive repositioning to a more balanced market phase. The price structure along the futures curve reinforces this interpretation: London cocoa saw stronger gains in nearby contracts than in deferred ones, a pattern typical of short covering in the front months, while the US curve showed somewhat broader participation but remained firmly in contango, meaning there is still no evidence of a physical supply squeeze or immediate shortage of deliverable cocoa.

Taken together, the data suggest that the market has likely moved from a short-pressure phase into a stabilization phase, driven initially by short covering and partially by new speculative longs entering the market. The decline in volume on 3 March indicates that the rebound may lose momentum in the near term, making a period of sideways consolidation more likely than an immediate continuation of a strong upward trend. Future price performance will depend heavily on whether open interest continues to expand with rising prices—which would confirm sustained long participation and a more durable rally—or whether open interest begins to decline, signaling that the recent strength was primarily short covering and therefore structurally fragile.

Cocoa ICE Stocks

Stock-to-Grind ratio

What to expect tomorrow

The cocoa market currently appears to be in a short-term stabilization phase following a sharp corrective decline. On the daily chart, prices around 3015–3020 are still trading well below the major moving averages. However, the recent candles show smaller ranges and slowing selling momentum, which suggests that the intense liquidation seen previously is fading. The RSI on the daily timeframe is near oversold territory, indicating that the market may attempt a technical rebound.

On the 1-hour chart, cocoa has recovered from the recent low near 2900 and is now consolidating around 3020. Short-term moving averages are beginning to support the price, and momentum indicators such as the MACD and RSI are neutral to slightly positive, indicating that buyers have regained some control in the short term.

The intraday structure on the 5-minute chart shows tight sideways movement around 3020, accompanied by declining volume and momentum indicators flattening. This typically signals that the rebound is losing immediate momentum. As a result, the most likely scenario for the next session is range-bound trading between roughly 2975 and 3050. If the market fails to break above 3040–3050, prices could gradually drift back toward the 3000 psychological level. A break below 3000 would increase the risk of another test of 2950–2920, while a strong move above 3040 with rising volume could trigger a short-term extension toward 3080–3100.

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.