New Cocoa Price Signals Shift: Ghana and West Africa Face Supply Crossroads as Global Demand Weakens

The global cocoa market is experiencing a critical inflection point. New cocoa price trends have hit significant lows as weakening demand collides with an emerging supply surplus. Ghana, the world’s second-largest cocoa producer, finds itself at the center of this market transformation, with shifting export patterns reflecting both harvest prospects and broader industry headwinds.

Cocoa Prices Hit Multi-Year Lows Amid Tepid Global Demand

Recent cocoa price action has been decidedly downward. New York ICE cocoa futures have plunged to 2-year lows, while London cocoa has reached its lowest levels in over 2 years. The sharp decline reflects growing market concerns about persistent weakness in global cocoa demand, a reversal from the supply-constrained period that defined 2023 and early 2024.

The demand picture has deteriorated materially across all major consuming regions. European cocoa processing fell sharply in the final quarter of 2024, declining 8.3% year-over-year to 304,470 metric tons—a steeper drop than anticipated and the weakest Q4 performance in over a decade. Asia’s processing sector mirrored this weakness, with cocoa throughput down 4.8% year-over-year to 197,022 metric tons. Even North America, typically more resilient, showed minimal growth with cocoa processing rising just 0.3% year-over-year to 103,117 metric tons.

This synchronized global slowdown signals that the tight supply conditions that dominated previous years have given way to a demand-driven market downturn.

West African Harvest Bounty Conflicts with Shrinking Export Flows

The paradox at the heart of the new cocoa price weakness lies in West Africa’s favorable production outlook. Recent reports from industry observers indicate robust growing conditions across the Ivory Coast and Ghana, with farmers reporting larger and healthier pods compared to the previous year. Chocolate manufacturer Mondelez noted that the latest pod count in West Africa stands 7% above the five-year average, signaling abundant supply potential.

Yet Ghana’s export performance tells a different story. Cumulative data through January 18 of the current marketing year shows Ghana and Ivory Coast combined shipments of 1.16 million metric tons—down 3.3% from the same period last year. This paradox of strong production but slower exports reflects the market’s transition from scarcity to abundance, pressuring prices downward.

Nigeria, the fifth-largest global cocoa producer, has faced sharper headwinds. November cocoa exports fell 7% year-over-year to 35,203 metric tons, with the Cocoa Association of Nigeria projecting a 11% production decline for 2025-26 to 305,000 metric tons from an estimated 344,000 metric tons in 2024-25. This supply reduction from secondary producers provides some support for new cocoa prices, though it has proven insufficient to offset the global demand weakness.

Inventory Shifts and the Changing Market Dynamics

Cocoa inventory levels tell a nuanced story. US-based cocoa inventories held at ICE-monitored ports initially tightened, falling to a 10-month low of 1.63 million bags in late December before recovering to 1.73 million bags in subsequent weeks. This inventory pattern, while showing some stabilization, reflects the broader market uncertainty surrounding cocoa’s new price trajectory.

The International Cocoa Organization’s latest projections have become notably less bullish than six months prior. In November, the ICCO cut its 2024-25 global cocoa surplus estimate to just 49,000 metric tons from a previous projection of 142,000 metric tons, while trimming global production estimates to 4.69 million metric tons from 4.84 million metric tons. Rabobank similarly reduced its 2025-26 surplus forecast to 250,000 metric tons from an earlier estimate of 328,000 metric tons.

These downward revisions represent a substantial rebalancing from the extreme scarcity of 2023-24, when the global cocoa deficit hit a historic 494,000 metric tons—the largest in over 60 years. The shift from historic deficit to modest surplus has fundamentally altered market psychology and pricing dynamics.

Policy Developments and Market Outlook

Recent regulatory developments have added complexity to the pricing picture. The European Union’s decision to delay implementation of its deforestation regulation (EUDR) by one year has allowed continued imports of cocoa from regions where deforestation remains prevalent, effectively maintaining ample supply flows to EU markets. This policy delay, announced in November, undercut prices by removing a potential supply constraint that might have otherwise supported valuations.

The new cocoa price environment reflects a market in transition. From the supply-constrained, historically tight markets of 2023-24 to the emerging surplus conditions of 2025-26, cocoa futures are repricing to reflect a fundamentally different supply-demand balance. Ghana and other West African producers face a market that will require adjustment to lower price levels, while consumers will benefit from improved availability and lower input costs. Whether new cocoa prices find a sustainable floor will depend on whether global demand stabilizes or faces further erosion in coming months.