Cocoa futures remain steady at $9,764 per ton, hovering just below the $10,000 resistance line, as global markets absorb the impact of trade tariffs and mixed harvest outlooks from West Africa.
Uncertainty around the mid-crop cocoa harvest, especially in major producing countries like Ghana and Côte d’Ivoire, and pressure from U.S. tariffs have kept prices from breaking new highs. Both London and New York contract prices are rebounding from April lows, boosted by unexpectedly strong grinding data from global cocoa associations — a key indicator of demand.
EU Regulations, Nigerian Exports in Focus
The European Union, the world’s largest consumer and exporter of chocolate, is enforcing deforestation regulations that now require ethical and sustainable cocoa sourcing. This has affected cocoa trade flows from West African nations including Nigeria, Cameroon, Ghana, and Côte d’Ivoire.
Amid a steep depreciation of the naira, Nigeria’s cocoa exports surged to N2.7 trillion in 2024, more than a sevenfold increase. This makes cocoa a key candidate for economic diversification in a country still heavily reliant on crude oil, which accounts for 90% of its exports.
Despite this, inconsistent cocoa quality and industry standards have sometimes led Nigerian cocoa to be sold at discounted prices on the global market.
Supply Deficits and Price Volatility
The International Cocoa Organization (ICCO) reported that prices recently surged to $8,787 in London and $9,286 in New York, still far below the $12,000 highs reached earlier in the year. Devastating weather, low farm gate prices, and entrenched rural poverty are worsening conditions for farmers in Ghana and Côte d’Ivoire, leading to a supply shortfall just as demand remains robust.
While a temporary suspension of U.S. tariffs in late April provided some relief, a 10% baseline tariff still applies to all cocoa imports, placing further strain on exporters and smallholder farmers.
The ICCO has urged market clarity with five months remaining in the current season, noting that price distortions and weak policy coordination continue to cloud the outlook for cocoa-dependent economies.
