Daily Cocoa Market Report (31 March 2026): Cocoa Rebounds on Short Covering Despite Steady Supply and Weak Demand Outlook

• Cocoa futures rebounded sharply on March 31, with NY May gaining around 3–4% in a short-covering rally
• Ivory Coast cocoa arrivals for the 2025/26 season reached about 1.423 million tonnes as of March 29, down 1.2% year-on-year
• Demand outlook remains weak, with preliminary forecasts pointing to year-on-year declines in grindings across Europe (down 3–7%) and Asia (down 8–12%), while North America is expected to be flat to slightly positive.

Cocoa futures rebounded sharply on March 31, with NY May contracts rising by roughly 3–4% in a strong short-covering move, recovering from recent multi-week lows within a broader downtrend environment. The rally was largely technical, supported by macro factors such as dollar weakness and positioning adjustment, rather than a clear shift in fundamentals.

Cocoa arrivals at ports in Ivory Coast for the 2025/26 season reached approximately 1.423 million tonnes as of March 29, down around 1.2% year-on-year, according to exporter estimates. The marginal decline suggests that supply remains broadly stable, though slightly below last season’s pace.

Ivory Coast Cocoa Port Arrivals – Weekly Deliveries Tracker

Ivory Coast cocoa port arrivals represent the volume of cocoa beans delivered to the country’s main export ports during the marketing season. As the world’s largest cocoa producer, Ivory Coast typically accounts for around 40–45% of global cocoa supply, making port arrivals one of the most closely

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Weekly arrivals picked up, with around 31,000 tonnes delivered to Abidjan and San Pedro combined, more than double the previous week. This increase reflects the release of beans that had been held back earlier in the season, as regulatory changes and the progression into the mid-crop encouraged farmers to sell. Exporters noted that deliveries accelerated after authorities moved forward the mid-crop timeline, allowing previously stored beans to enter the market.

Despite the slight year-on-year decline in cumulative arrivals, underlying supply conditions remain comfortable. Farmers have continued selling steadily, even as farmgate prices dropped sharply to around 1,200 CFA/kg, with limited capacity to hold back stocks. Industry sources estimate that significant volumes were transacted during March, easing earlier concerns that producers might resist selling at lower prices.

On the demand side, exporter activity has improved in recent weeks and is expected to strengthen further into April as grinders rebuild depleted stocks. However, the broader context remains one of weak global demand and excess supply, which has weighed heavily on prices and contributed to the accumulation of unsold beans earlier in the season.

Looking ahead, market attention is shifting to the global grindings data due on April 16. Current expectations point to a year-on-year slowdown in processing across key regions. Europe is projected to decline by roughly 3% to 7%, while Asia is expected to contract more sharply, in the range of 8% to 12%. North America, by contrast, is seen holding relatively stable, with estimates ranging from flat to a modest increase of up to 2%.

These projections differ from another set of forecasts, which anticipate a smaller decline in Europe of around 2.9%, but steeper contractions in Asia at approximately 11.5% and in North America at about 13.5%. Despite some variation in regional expectations, the outlook continues to point to soft demand conditions. However, any upside surprise in the grind data could provide near-term support to prices and challenge the current demand narrative.

Futures Performance

NY Cocoa Futures (CC)

The transition from 30 March to 31 March shows a decisive reversal in market direction, particularly in NY cocoa futures. After the prior session’s uniform decline, the entire curve rebounded sharply, with gains concentrated in the front and mid-tenors. May-26 through Sep-26 posted increases of roughly 4.3% to 4.6%, while the strength tapered into the deferred structure, with Mar-27 rising by only 2.8%. This creates a clear bull-flattening profile, where near-term contracts outperform longer-dated ones. The pattern strongly indicates short covering and positioning adjustment rather than a structural change in fundamentals. Market participants appear to have aggressively reduced short exposure in liquid contracts, while maintaining more cautious positioning further out the curve.

London Cocoa Futures (C)

In London cocoa futures, the same directional move is evident but with slightly different characteristics. The rebound is more evenly distributed across the curve, although the front end still leads. May-26 rises nearly 5%, outperforming NY on a relative basis, while even deferred contracts such as Mar-27 post solid gains above 3%. This suggests that, in addition to short covering, there may be stronger underlying support or physical-linked buying in the London market. The curve still flattens, but less aggressively than in NY, indicating broader participation across maturities.

Comparing both markets, the move appears synchronized and macro-driven, but the internal structure differs. NY displays a more pronounced front-loaded recovery, consistent with systematic or speculative positioning flows being unwound. London, by contrast, shows a more balanced repricing, implying better absorption of selling pressure and possibly stronger conviction across the forward curve. In both cases, the dominance of front-end strength over deferred contracts confirms that the rally is not yet signaling a long-term bullish shift, but rather a near-term rebalancing of risk and positioning following the previous session’s decline.

EFP, EFS and Spread Activity

In NY cocoa futures, activity on 31-Mar is overwhelmingly dominated by calendar spread trading, with spread volume accounting for a very large share of total turnover. This indicates that the session’s price move was primarily driven by curve re-positioning rather than outright directional conviction or physical demand. Participants were actively adjusting exposure along the term structure, likely covering shorts in the front and rebalancing relative value across maturities, which directly aligns with the observed bull-flattening move. EFP and EFS volumes are present but comparatively small and concentrated almost entirely in the front month, suggesting that physical hedging and swap-related flows played only a secondary role. Overall, the NY market behavior is characteristic of a financially driven adjustment, where liquidity and positioning flows dominate price formation.

In contrast, London cocoa futures display a more balanced flow profile. While spread trading remains significant, it is less dominant relative to total volume, and there is a notably higher level of EFP activity. The presence of EFP across both front and deferred contracts indicates more meaningful participation from physical market actors, including forward hedging and structured transactions. The absence of EFS suggests that swap-driven financial flows are not a key component in London. This combination of spread and physical-linked activity implies that the price move is not purely technical or positioning-driven, but instead reflects a broader base of engagement, including underlying commercial interest.

US–UK May Spread

$3,271 − (2480 x 1.324$/£) =$-13ton (down from $18)

Volume and Open Interest

NY Cocoa Futures (CC)

The volume and open interest dynamics in NY cocoa futures (CC) show a clear transition from position building into position adjustment. Open interest rises steadily from around 190k to just above 200k by 30-Mar, indicating consistent net length accumulation or short build-up during this phase. At the same time, daily volumes trend lower into the end of March, dropping from around 40k to the mid-20k range. This suggests that participation was narrowing while positions were being held rather than actively traded. This combination typically reflects maturing positioning, where conviction is established but incremental flows slow.

The key inflection occurs on 31-Mar, where volume spikes sharply to 53,729, more than double the prior session, while open interest is not reported but can be inferred as likely declining or at least not increasing proportionally. This type of volume expansion following a steady build in open interest strongly indicates position unwinding or rotation, rather than fresh positioning. Given the concurrent sharp price rally observed earlier, the most consistent interpretation is short covering and active rebalancing, particularly concentrated in the front and mid-curve. The surge in volume confirms that the move was not passive but driven by aggressive execution.

London Cocoa Futures (C)

In London cocoa futures (C), the structure is more stable and linear. Open interest increases consistently from around 200k to about 214k across the period, showing a sustained build in positions without interruption. Unlike NY, volume does not exhibit a late-period spike. Instead, it remains relatively contained, mostly in the 20k to 26k range, with a dip on 30-Mar to 17.7k followed by a moderate recovery on 31-Mar to 28.4k. This pattern suggests gradual accumulation with less forced repositioning, and importantly, no evidence of large-scale liquidation.

Comparatively, the divergence is clear. NY shows a classic build to stress to unwind sequence, where rising open interest is followed by a sharp volume-driven adjustment. London, in contrast, maintains a steady build profile, with open interest increasing alongside controlled volume. This indicates more stable participation and less reactive flow. This reinforces the earlier conclusion that NY is dominated by financial positioning cycles, while London reflects more stable, structurally supported positioning, likely with stronger linkage to underlying physical or commercial activity.

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:

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What to expect tomorrow

The most probable scenario for tomorrow is continuation into consolidation rather than a clean trend extension. The 31-Mar move was impulsive and volume-driven, which typically requires digestion before any further directional move. Given that price stalled just below and around the 3300 area, the market is likely to open with two-sided activity, testing whether that level can hold as support.

In the base case, expect range-bound behavior between roughly 3250 and 3320. Early in the session, there may be a mild attempt to extend higher, but without fresh volume expansion, upside is likely to be capped. Momentum indicators already show deceleration, which supports a grind or slight pullback rather than immediate continuation. A shallow retracement into the 3250–3270 zone would be technically healthy and consistent with a post-breakout structure.

If the market holds above ~3250 and forms higher intraday lows, the bias remains constructive, and a secondary push toward 3330–3350 becomes possible later in the session. However, that would require renewed participation, not just passive holding. Without that, price is more likely to rotate sideways.

On the downside, a break back below 3250 would signal that the 31-Mar move was primarily short covering with limited follow-through. In that case, the market could fade back toward 3200–3220, retracing part of the impulse.

The highest probability outcome is consolidation with a slight upward bias, not a continuation breakout. The key variable to monitor is whether the market can hold above the breakout zone and attract fresh volume, which would determine whether this evolves into a sustained recovery or remains a corrective bounce.

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.