Why Have Cocoa Prices Recovered?

I asked if ICE cocoa futures were heading back to pre-2024 prices on Barchart on June 16, 2026, when I concluded with the following:

While the wild price swings in 2024 and 2025 are in the cocoa futures markets’ rearview mirror, the potential for weather-related volatility remains high. Moreover, with approximately 60% of the world’s cocoa production coming from the Ivory Coast and Ghana, weather conditions in West Africa will be the critical factor guiding prices over the coming months and years. 

Cocoa is now trading on the high side relative to pre-2024 prices, and a continuation of ample supplies will likely push the price back towards the $1756-$2,943 range that cocoa futures traded in from 2017 through February 2023.  

Nearby ICE cocoa futures were trading near $3,950 per ton on June 15, and have rallied over the past few months, reaching over $6,000 per ton as the soft commodity rejected the 2017 to 2023 trading range. 

Cocoa rallies

After plunging 78%, ICE cocoa futures bottomed and turned higher. 

The continuous contract monthly chart shows that cocoa futures surpassed the $5,104 per ton 1977 high in February 2024, and rose to a record $12,931 per ton peak in December 2024, where they ran out of upside momentum. Cocoa futures plunged to a low of $2,846 in March 2026, where they turned higher, rising to $6,478 in July. At over $5,900 in early August, cocoa continues to make higher lows and higher highs. 

West African weather and crop disease cause more supply concerns

Heavy rains in West Africa, causing flooding in the Ivory Coast and Ghana, the world’s leading cocoa-producing countries, have threatened crop yields. Moreover, expectations of a strong El Niño weather pattern and rising global chocolate demand have increased concerns of a long-term supply deficit. 

The elevated West African moisture that flooded farms and damaged infrastructure used to transport cocoa beans from farms to ports for export has increased the risk of crop diseases such as brown rot. Meanwhile, forecasts of a strong El Niño, which brings warmer, drier conditions, could stress cocoa trees and reduce bean yields. 

Demand surged as the price dropped

Commodity cyclicality in 2024, which drove cocoa futures to nearly $13,000 per ton, led to higher inventories and declining demand as cocoa consumers sought alternatives. Chocolate manufacturers reduced portion sizes to deal with high prices, and consumers purchased fewer chocolate confectionery products. As the price plunged, consumption rebounded. The National Confectioners Association reported that North American cocoa grindings rose unexpectedly by 7.7% year-over-year, with leading chocolate manufacturers reporting increased sales. 

Weather issues impacting supply and lower prices spurring demand caused cocoa futures to bottom and prices to explode higher from the March 2026 low. 

Levels to watch in the cocoa futures market

The twenty-year monthly continuous ICE cocoa futures contract highlights the extreme volatility and current technical support and resistance levels.

The chart shows that technical support is now far below the current price level at the March 2026 low of $2,846 per ton. While resistance is at the July 2026 high of $6,478 per ton, the next upside target is the October 2025 high of $6,821 per ton. 

The 2026 year-to-date continuous contract cocoa chart shows that the July 9 high was a new high for 2026, and that cocoa futures have been in a bullish trend since the early March low, making higher lows and higher highs. Short-term technical support is significantly below the current price at the May 22 low of $3,651, with resistance at the July high of $6,478 per ton. 

The factors that will keep cocoa futures prices elevated over the coming months

The weather and crop diseases are the most significant factors for the path of least resistance of cocoa futures prices over the coming days and weeks. Meanwhile, the following factors could influence prices aside from the issues impacting crops:

• Global inflation and stubbornly high interest rates increase production costs.
• Wars in Ukraine and the Middle East have increased insurance and shipping costs, impacting all exports, including cocoa.
• After falling from nearly $13,000 per ton, which destroyed demand, prices below $6,000 remain attractive to consumers, so price elasticity has moved to a much higher level after the rally to an all-time high.
• Cocoa production is limited by climate, making West Africa a critical producing region. Aside from the weather, political issues that affect logistics could always affect exports and global supply chains. 

The bottom line is that cocoa futures have shifted from selling all rallies after late 2024 to buying dips since March 2026. No ETF or ETN tracks cocoa, so futures and futures options on the Intercontinental Exchange are the only vehicles for trading in the volatile soft commodity. In early August 2026, buying cocoa on price weakness is optimal, as the trend is a trader’s best friend until it bends.