Cocoa prices fell to their lowest levels in two years this week, extending a steep decline that began in 2025 as rising global output and weaker demand weigh on the market.
In London, cocoa futures dropped to £3,315 per tonne on Tuesday, equivalent to about US$4,470, while contracts on ICE New York slid to as low as US$4,612 per tonne. The losses mark a sharp reversal from the record highs seen in 2024, when supply shortages pushed prices to unprecedented levels.
The downturn reflects a market that has swung back into surplus after three consecutive deficit seasons between 2021/22 and 2023/24. Analysts say higher production in major growing countries, combined with demand destruction caused by elevated prices, has altered market fundamentals.
Cocoa futures in New York fell by about 48 percent in 2025 after surging 178 percent the previous year. In London, benchmark contracts lost roughly 50 percent in 2025, following gains of 158 percent in 2024. Prices had rallied strongly in 2024 amid poor harvests, disease outbreaks and weather-related disruptions in West Africa, which accounts for about 70 percent of global cocoa production.
The International Cocoa Organization (ICCO) now expects the global cocoa market to post a surplus of around 49,000 tonnes in the 2024/25 season. Production is forecast to increase in the world’s three largest cocoa-producing countries.
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In Côte d’Ivoire, the world’s top producer, output is projected to reach about 1.85 million tonnes, up from 1.67 million tonnes a year earlier. Ghana’s crop is expected to rise to around 600,000 tonnes from 530,000 tonnes, while production in Ecuador, the leading producer outside Africa, is forecast at about 480,000 tonnes, compared with 430,000 tonnes previously.
Looking further ahead, Rabobank estimates the global cocoa market could record a surplus of around 250,000 tonnes in the 2025/26 season, reinforcing expectations that supply will continue to outpace demand in the near term.
On the demand side, recent data point to a slowdown in cocoa processing, a key indicator of chocolate consumption. Cocoa grindings declined sharply in the fourth quarter of 2025 across most major consuming regions, reflecting pressure on consumer spending as manufacturers pass on higher costs.
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In Asia, grindings fell 4.82 percent year-on-year to 197,022 tonnes. Europe saw an even steeper drop of 8.3 percent to 304,470 tonnes, the lowest quarterly level in more than two decades. Grindings in the United States rose marginally by 0.35 percent to 103,117 tonnes, but analysts say overall demand remains subdued.
“High prices over the past year have clearly curbed consumption,” said one commodities analyst. “Even though prices are now falling, it may take time before demand fully recovers, especially in price-sensitive markets.”
The impact of weaker demand has also been reflected in company earnings. Barry Callebaut, the world’s largest chocolate maker, reported first-quarter revenue for its 2025/26 financial year rose 6.4 percent to 3.67 billion Swiss francs, or about US$4.64 billion. However, sales volumes fell by 9.9 percent, as consumers reduced purchases in response to higher retail prices. The company’s fiscal first quarter runs from September to November.
In West Africa, the pace of cocoa sales has slowed despite improved harvest prospects. Authorities in Côte d’Ivoire said this week they would purchase around 123,000 tonnes of unsold cocoa from producing regions, seeking to support farmers after a sharp decline in bean sales.
Analysts say the coming months will be critical for cocoa prices, with attention focused on crop conditions, stock levels and government interventions in West Africa. While supply is improving, uncertainty remains over how quickly demand will rebound after the sharp price swings of the past two years.
