Cocoa Futures Pull Back from Record Prices but Remain Historically High

After months of wild swings, cocoa futures are cooling off, but prices remain above their long-term averages.

Cocoa has come a long way down from the panic highs of late 2024, when supply fears out of West Africa sent futures into a big rally. But even after a pullback in price, cocoa remains one of 2025’s most expensive soft commodities.

The world’s two biggest producers, Ivory Coast and Ghana, are showing very little improvement in crop conditions. Ghana’s 2025/26 harvest could top 650,000 tonnes, exceeding government targets. Ivory Coast’s mid-crop is still weak but stabilizing after last year’s drought and disease issues.

Better rainfall, improved fertilizer access, and ongoing rehabilitation programs are supporting yields. However, analysts warn that bean quality remains poor, and weather risks are still very relevant.

Chocolate makers have scaled back processing as high input costs hit margins. Grinding data shows a slowdown in Europe and Asia, while consumer prices for chocolate remain high.

For companies like Hershey and Mondelez, lower futures offer some help for their costs, but raw cocoa costs are still well above pre-2023 averages.

After the 2024 rally, speculative long positions have unwound, triggering a correction. Analysts point to potential support around US $5,000/tonne, which aligns with historical resistance levels from the 1970s.

Even so, cocoa’s price chart remains elevated, roughly double its five-year average, showing that the market is not yet in surplus territory.

One thing to monitor is West African weather, return of drought or disease could spark a spike in prices. Another factor is European traceability and deforestation laws may tighten export flows in 2026. This would have a big impact on prices. From there consumer response will be important, continued price sensitivity in chocolate demand could cap future rallies. The last piece is to watch where managed money positions remain, renewed buying could amplify volatility.

For now, although prices have come down, numbers near US $6,000/tonne signal a market finding balance between better harvests and cautious consumption.

For investors, cocoa remains one of the most closely watched soft commodities of 2025, a story of recovery, scarcity, and a market still finding balance after last year’s historic rally.

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