New York cocoa recovered from intraday lows as Transgraph forecast a smaller 2026/27 surplus and Indonesia reported 30% higher Q2 grindings (23 July 2026)
New York cocoa traded through a volatile session on 23 July. The September 2026 contract opened at 5,273 and initially advanced to an intraday high of 5,411 before renewed selling pressure pushed prices sharply lower to 5,165.
Buying interest returned later in the session, allowing the contract to recover steadily and finish at a Close# price of 5,367. This was 14 points, or 0.26%, above the 22 July close. Despite the late recovery, the contract officially settled at 5,301, down 27 points, or 0.51%, from the previous settlement.
The recovery coincided with a more supportive longer-term supply outlook. Transgraph Consulting forecasts a global cocoa surplus of approximately 98,000 tonnes for the 2026/27 season, substantially below the estimated surplus of 415,000 tonnes expected in 2025/26.
Global cocoa production is projected at approximately 4.8 million tonnes in 2026/27, representing an annual decline of 4.6% from an estimated 5.1 million tonnes in the previous season. Transgraph Chairman and Managing Director Nagara Meda warned that production could fall further should El Niño conditions become particularly severe.
Côte d’Ivoire, the world’s largest cocoa producer, is forecast to record a production decline of approximately 16% next season. Output in Ghana and Ecuador could also weaken following periods of heavy rainfall, while Indonesia faces an increased probability of below-average rainfall across important cocoa-producing areas in Sulawesi and Sumatra.
The weaker production outlook contrasts with expectations for recovering demand. Transgraph projects global cocoa demand to increase by approximately 3% in 2026/27, with grindings estimated at around 4.79 million tonnes. Stronger processing activity would absorb most of the projected crop and significantly reduce the market’s supply buffer.
For the next six months, Transgraph expects cocoa prices to trade within a broad range of approximately $4,800 to $6,800 per tonne. The wide range reflects continued uncertainty surrounding weather conditions, crop development and the strength of the expected demand recovery.
Cocoa prices have remained supported by concerns that adverse weather could disrupt production. However, the market has recently undergone a substantial correction as participants wait for clearer evidence that crop prospects are deteriorating.
The Transgraph forecast is more supportive than a recent Reuters survey, which indicated that analysts and traders broadly expected the global cocoa market to be balanced in 2026/27 following a significant surplus in the current season.
Longer-term demand expectations also remain constructive. Speaking at the same industry conference, Cargill executive Kashan Rashid said demand for cocoa and chocolate remained strong and was expected to continue expanding across different chocolate categories over the coming years.
Indonesia’s cocoa grindings rise 30% in Q2
Indonesia’s cocoa grindings increased sharply during the second quarter of 2026, supported by strong demand for intermediate cocoa products, according to the country’s Ministry of Industry.
Grinding volume reached approximately 110,410 tonnes between April and June, up from 84,844 tonnes in the first quarter. This represented a quarter-on-quarter increase of approximately 30%.
However, the domestic production outlook remains uncertain. Prolonged rainfall at the beginning of the year may have affected cocoa output in several producing regions, while the possible strengthening of El Niño conditions during the third quarter could create additional risks for future bean availability.
The increase in processing demand comes as Transgraph forecasts Indonesian cocoa production at approximately 200,000 tonnes in 2026/27, compared with around 210,000 tonnes in the current season.
If grindings remain elevated while domestic production declines, Indonesian processors could become increasingly dependent on imported cocoa beans. This could strengthen regional import demand and increase competition for available supplies, particularly if adverse weather also reduces output in other major producing countries.
Corporate results
Recent corporate results provided further evidence that high cocoa costs are continuing to pressure confectionery manufacturers, even as branded chocolate demand remains relatively resilient in some markets. Nestlé reported first-half 2026 sales of CHF 43.1 billion, with organic growth of 3.6% and second-quarter organic growth of 3.7%. However, underlying trading operating profit declined by 2.8% to CHF 7.1 billion, while the operating margin fell to 16.4%, as elevated cocoa and coffee costs continued to weigh on profitability. The company reported solid growth for KitKat and other confectionery brands in Asia, Oceania and Africa, although confectionery sales weakened in Europe amid more difficult consumer conditions. Nestlé nevertheless expects lower cocoa and coffee prices to begin providing some cost relief during the second half of 2026.
Tootsie Roll reported a more pronounced earnings impact, with second-quarter sales falling by 1% year on year to $151.9 million. Net earnings declined by 23.9% to $13.35 million from $17.54 million, while earnings per share fell to $0.18 from $0.23. Management directly attributed the weaker gross margin to significantly higher cocoa and chocolate input costs, but said lower-cost raw materials should begin entering its supply chain during the second half of 2026 and into 2027.
In contrast, Nigeria-based FTN Cocoa Processors reported first-half sales of NGN 4.13 billion, more than double the NGN 1.81 billion recorded a year earlier, while net income improved to NGN 657.7 million from a loss of NGN 1.14 billion. Overall, the results suggest that cocoa-cost inflation is still affecting downstream margins, although manufacturers are increasingly anticipating cost relief as lower-priced cocoa begins to move through inventories and procurement contracts.
West African Weather Outlook
Rainfall is expected to remain widespread across the West African cocoa belt during the period from 24 to 31 July. Much of Côte d’Ivoire and Ghana is projected to receive light to moderate precipitation, with an indicated accumulation of approximately 34 mm near Bondoukou in eastern Côte d’Ivoire.
The forecast does not currently show exceptionally heavy rainfall across the principal cocoa-growing areas of Côte d’Ivoire and Ghana. These conditions should generally support soil moisture and crop development. However, continued rainfall could slow harvesting and fieldwork in wetter locations while maintaining the risk of fungal disease and pod losses where drainage is poor.
Heavier rainfall is forecast farther west across parts of Guinea, Sierra Leone and Liberia, as well as around southern Nigeria and coastal Cameroon. Overall, the outlook appears broadly favourable for the main West African cocoa crop, although the distribution and persistence of rainfall will remain important over the coming weeks.
Futures Performance
Comparing the 22 July prices with the 23 July values, cocoa futures recorded a broad-based but uneven recovery. All monitored contracts finished above their 22 July levels. The rebound was modest in New York, where gains ranged from 11 to 19 points, while London recorded a materially stronger increase of between 33 and 40 points. Nevertheless, the advances recovered only part of the sharp losses registered during the previous session and therefore appear more consistent with a technical rebound than a decisive reversal of the recent bearish movement.
New York cocoa
| CONTRACT | 22 JUL | 23 JUL | CHANGE | CHANGE % |
|---|---|---|---|---|
| Sep-26 | 5,353 | 5,367 | +14 | +0.26% |
| Dec-26 | 5,492 | 5,508 | +16 | +0.29% |
| Mar-27 | 5,591 | 5,610 | +19 | +0.34% |
| May-27 | 5,602 | 5,613 | +11 | +0.20% |
In New York, the four monitored contracts increased by between 11 and 19 points, equivalent to gains of approximately 0.20% to 0.34%. March 2027 recorded the strongest performance in both absolute and percentage terms, rising 19 points from 5,591 to 5,610, or 0.34%. December advanced by 16 points to 5,508, while September gained 14 points to close at 5,367. May 2027 was the weakest contract, increasing by only 11 points, or 0.20%, to 5,613.
The New York forward curve remained upward sloping. The December-to-September premium widened slightly from 139 points on 22 July to 141 points on 23 July. The March-to-December premium also increased, moving from 99 to 102 points. In contrast, the May premium over March narrowed from 11 points to only three points. This indicates that the recovery was concentrated more strongly in the middle of the curve, while the far end remained comparatively restrained.
The contracts recovered substantially from their intraday lows. The four closes were between 195 and 202 points above the lowest prices recorded during the session and finished within the upper portion of their daily trading ranges.
London cocoa
| CONTRACT | 22 JUL | 23 JUL | CHANGE | CHANGE % |
|---|---|---|---|---|
| Sep-26 | 3,941 | 3,981 | +40 | +1.01% |
| Dec-26 | 4,004 | 4,041 | +37 | +0.92% |
| Mar-27 | 4,088 | 4,121 | +33 | +0.81% |
| May-27 | 4,087 | 4,126 | +39 | +0.95% |
London cocoa recorded a substantially stronger recovery in percentage terms. The monitored contracts advanced by between 33 and 40 points, representing gains of approximately 0.81% to 1.01%. September 2026 was the strongest contract, increasing by 40 points from 3,941 to 3,981, or 1.01%. May 2027 followed closely with a gain of 39 points to 4,126, while December rose by 37 points to 4,041. March recorded the smallest increase, gaining 33 points, or 0.81%, to close at 4,121.
The London forward curve remained upward sloping overall, although the front-to-middle section flattened slightly. The December premium over September narrowed from 63 points to 60 points, while the March premium over December declined from 84 to 80 points. At the far end of the curve, May moved from a one-point discount to March on 22 July to a five-point premium on 23 July. The previous minor March-to-May inversion therefore disappeared.
EFP, EFS and Spread Activity
EFP, EFS and spread activity on 23 July was concentrated mainly in the nearby and intermediate contracts. London recorded considerably greater EFP and EFS activity than New York, while spread trading represented a substantial proportion of total volume in both markets.
New York cocoa
New York recorded 163 EFP transactions, equivalent to approximately 0.47% of total reported volume of 34,602 contracts. All EFP activity was concentrated in the two nearest contracts. September 2026 accounted for 100 contracts, while December 2026 recorded 63. No EFS or block volume was reported.
Spread volume reached 23,724 contracts, representing approximately 68.56% of total New York volume. December 2026 recorded the highest spread activity at 8,798 contracts, followed by September 2026 at 6,495 and March 2027 at 5,079. May 2027 contributed a further 2,084 contracts.
London cocoa
London recorded significantly stronger EFP activity, with 829 contracts representing approximately 3.91% of total volume of 21,204 contracts. December 2026 dominated EFP activity with 584 contracts, equivalent to around 70% of the London total. September 2026 recorded 207 contracts, while March 2027 contributed 38.
EFS activity amounted to 151 contracts and was entirely concentrated in September 2026. No block volume was reported.
Spread volume reached 12,899 contracts, equivalent to approximately 60.83% of total London volume. December 2026 was again the most actively traded contract in spread terms, recording 4,268 contracts. March 2027 followed with 3,159, September 2026 with 2,829 and May 2027 with 1,369.
US–UK Spread
(Sep Contract)
$5,367 − (£3,981 x 1.331$/£) =$72ton (down from $83ton)
Volume and Open Interest
Trading activity declined in both cocoa markets on 23 July, indicating that the price recovery occurred with comparatively limited participation. Combined New York and London volume fell from 67,408 contracts on 22 July to 55,806 contracts on 23 July, a decrease of 11,602 contracts, or approximately 17.21%.
New York cocoa
| DATE | TOTAL VOLUME | TOTAL OPEN INTEREST |
|---|---|---|
| 17 Jul 2026 | 34,667 | 208,055 |
| 20 Jul 2026 | 37,091 | 204,934 |
| 21 Jul 2026 | 49,400 | 201,552 |
| 22 Jul 2026 | 40,347 | 200,429 |
| 23 Jul 2026 | 34,602 | N/A |
New York cocoa recorded total volume of 34,602 contracts on 23 July, compared with 40,347 contracts on 22 July. This represented a decline of 5,745 contracts, or 14.24%.
The reduction in turnover indicates that the modest increase in New York prices was not accompanied by stronger market participation. At 34,602 contracts, volume was also among the lowest active-session totals recorded during July. This suggests that the rebound was driven more by reduced selling pressure, short-covering or technical positioning than by broad-based new buying interest.
The latest valid New York open-interest figure was 200,429 contracts on 22 July, down 1,123 contracts, or 0.56%, from 201,552 on 21 July. Open interest had also declined from its recent peak of 208,055 contracts on 17 July, representing a reduction of 7,626 contracts, or approximately 3.67%, by 22 July. This indicates that some market participants had already been reducing positions before the 23 July recovery.
London cocoa
| DATE | TOTAL VOLUME | TOTAL OPEN INTEREST |
|---|---|---|
| 17 Jul 2026 | 30,637 | 226,775 |
| 20 Jul 2026 | 21,296 | 227,840 |
| 21 Jul 2026 | 23,313 | 227,317 |
| 22 Jul 2026 | 27,061 | 228,134 |
| 23 Jul 2026 | 21,204 | N/A |
London cocoa recorded total volume of 21,204 contracts on 23 July, down from 27,061 contracts on 22 July. This was a decrease of 5,857 contracts, or 21.64%.
The decline was proportionally larger than in New York. Despite London recording the stronger price recovery, its trading volume was the lowest reported during the July period shown in the data. The combination of stronger prices and sharply lower volume suggests that the rebound lacked broad participation and may have been influenced by short-covering or reduced availability of sellers rather than aggressive new long positioning.
London open interest remained below its recent high of 236,125 contracts recorded on 9 July. Between 9 and 22 July, open interest declined by 7,991 contracts, or approximately 3.38%, indicating a broader reduction in outstanding market exposure during the second half of the month.
Exchange Trading Volume
| EXCHANGE | 22 JUL 2026 | 23 JUL 2026 | CHANGE | % CHANGE |
|---|---|---|---|---|
| ICE U.S. Cocoa | 3,301,990 | 3,308,066 | +6,076 | +0.18% |
| ICE Europe Cocoa | 1,150,313 | 1,150,313 | 0 | 0.00% |
| Combined | 4,452,303 | 4,458,379 | +6,076 | +0.14% |
The measure is not a complete regional stock-to-grind ratio, as it includes only exchange-certified cocoa held at U.S. and EU delivery ports and excludes commercial inventories outside the ICE warehouse system. North America NCA grindings cover processors across North America, while ICE U.S. certified stocks are stored at U.S. delivery ports. ECA reports bean usage in European countries and London-certified cocoa is held in European and UK delivery locations.
Readers can explore detailed cocoa market datasets, futures statistics, and historical indicators in the CocoaIntel Data Hub:
Cocoa IntelTomorrow's Outlook
New York cocoa is likely to remain volatile but could attempt a further technical recovery after rebounding strongly from the 23 July low. Initial resistance is expected around 5,400–5,450, and a sustained move above this area could extend gains toward 5,500. However, the broader trend remains fragile, and failure to hold above 5,300 would increase the risk of renewed selling toward 5,250 and potentially the 5,165–5,200 support zone. The most likely scenario is consolidation with a slight upward bias, rather than a confirmed bullish reversal.
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.
