Cocoa Market Update – December 2025
Price Trend and Market Drivers
Close Price (2025‑12‑04): 5,643 USD per metric ton.
Recent Volatility (2025‑12‑04 to 2025‑12‑06):
Prices fell on 04 Dec due to a strengthening U.S. dollar and British pound.
Prices rose sharply on 05 Dec as market participants priced in a potential reduction of the global cocoa surplus.
The upward pressure was reinforced on 06 Dec, although the overall trend remained flat.
Supply Outlook:
Bloomberg (5 Dec) reported that the cocoa market is “expecting a smaller global surplus.”
This sentiment was echoed by multiple Barchart articles on 5 Dec, both referencing a tighter supply outlook.
Ivory Coast Glut and Cash Constraints
Port Congestion:
On 06 Dec, gcaptain.com highlighted a temporary glut of cocoa at Ivory Coast ports.
Farmers are rushing to find buyers, but many are unable to do so due to cash shortages.
The glut is temporary, but it has contributed to short‑term price support.
Implications for Traders:
Traders in West Africa may face inventory holding costs while waiting for buyers.
The cash‑flow issue could delay shipments, potentially tightening the market further if the glut persists.
Corporate and Industry Developments
Hershey’s Earnings Recovery:
Investing.com (04 Dec) noted that Hershey’s earnings are on a recovery path, but cocoa pressure remains a risk factor.
The company’s valuation cap upside is tied to cocoa price stability.
Alternative Cocoa Products:
Foodbusinessnews.net (04 Dec) reported that CSM Ingredients introduced a new product derived from the carob tree, marketed as “Nuaré.”
This development may offer a substitute for traditional cocoa, potentially influencing demand dynamics.
Security and Political Context
- Robbery Incidents:
- Adomonline.com (04 Dec) reported that two individuals were arrested following a robbery syndicate attack on a gold firm, a cocoa depot, and a bank in Nkasiem.
- While the incident did not directly alter cocoa supply, it underscores security risks in regions critical to the supply chain.
Broader Economic Environment
Currency Strength:
The U.S. dollar and British pound have shown relative strength against commodity currencies, contributing to a downward pressure on cocoa prices in the short term.
This effect was evident in the price declines on 04 Dec.
Inflation Trends in Ghana:
Newsghana.com.gh (06 Dec) reported that food inflation in Ghana dropped to 6.6 % in November.
Lower inflation may boost consumer purchasing power, potentially supporting chocolate sales in the region.
Summary
The cocoa market in late December 2025 is characterized by:
- Price volatility driven by currency movements and expectations of a shrinking global surplus.
- A temporary supply glut at Ivory Coast ports caused by cash shortages among farmers.
- Industry responses, including Hershey’s earnings recovery outlook and the introduction of alternative cocoa products.
- Security concerns in key supply regions, though not yet affecting market supply levels.
These factors collectively suggest that while short‑term price swings are likely to continue, the underlying fundamentals—particularly supply‑demand balance and geopolitical stability—will dominate longer‑term price trajectories.
