The price of cocoa on the international markets has soared by 150% since the beginning of the year and has touched US$10,000 per tonne for the first time, but there are doubts that the peak has been reached, according to analysts consulted by Lusa.
The price of cocoa futures for delivery in May, traded on the New York stock market, has been rising since last year, with the raw material reaching new all-time highs on Tuesday, when it briefly traded above US$10,000 per tonne.
On the international markets, the price of cocoa has risen by 60% over the last year, but since the beginning of the year, in less than three months, the price of cocoa has already increased by almost 150%, says Banco Carregosa senior economist Paulo Rosa.
Driving this increase is, above all, the shortage of supply, which the economist points out is visible in the negative slope of the price curve of the various futures contracts, where prices for immediate delivery, as well as those for shorter terms, are higher than those for longer-term contracts (bearing in mind that the increase in demand for cocoa remains constant and predictable over the years).
Paulo Rosa points out that the futures contract for delivery in December 2025 stands at US$5,650, almost 45 % below the current prices for delivery in May.
Considering that the US$10,000 per tonne mark for futures for delivery in May could be a psychological barrier for investors, Henrique Tomé, spokesman for the brokerage firm XTB, believes that we shouldn’t “rule out the possibility that cocoa prices will start to correct slightly”.
However, he emphasises that “the buying force has been very strong over recent times” and that, in recent months, “the moments when the price appeared to show signs of slowing down have ended up being marked by strong upward movements in cocoa”.
“That’s why it’s still difficult to say whether prices have already peaked, not least because the problems related to supply could worsen and this should be reflected in the price of the raw material,” he said, emphasising that “these increases may not only be related to fundamentals, but are also associated with the activity of speculative funds.”
Paulo Rosa warns that chocolate producers are gradually starting to pass on the rise in this agricultural raw material in their products and, as a result, “end customers will see more expensive prices for chocolate and all sweets that use cocoa in their confectionery”.
The shortage of this raw material was already being felt last year, but the reduction in supply, especially from West Africa, the main producing region (which is expected to record its third consecutive annual deficit), is expected to be even greater this year, due to lower than expected harvests as a result of growing problems caused by “swollen shoot disease”, heavy rains and dry heat affecting crops.
“The outlook for the next harvests is not encouraging and there is likely to be a growing shortage of cocoa, which could push prices up a little more,” says Paulo Rosa, pointing to a fourth consecutive shortfall in the next harvests.
Among the world’s main producers are Côte d’Ivoire and Ghana, with global market shares of 43% and 20% respectively.
“The International Cocoa Organisation (ICCO) anticipates that the global cocoa deficit in 2023/24 could increase to 374,000 metric tonnes, from a negative balance of 74,000 metric tonnes in 2022/23,” says Banco Carregosa’s senior economist.
Paulo Rosa also points out that the ICCO also estimates that global cocoa production in 2023/24 will fall by 11 % in annual terms to 4.45 million metric tonnes, and global cocoa grinding will fall by almost 5 %, which will push the 2023/24 stocks/grinding ratio to the lowest level in more than 40 years.
Henrique Tomé emphasises that although other producers, such as Brazil or Ecuador, want to increase their production, it will take “a few years for the newly planted cocoa trees to bear fruit”.
“In addition, the new environmental rules that are about to be approved in the European Union, a major cocoa importer, should limit supply even more. Cocoa reserves have been declining since the second half of 2023, but are nowhere near the scale of the change in futures prices,” says the XTB spokesperson.
