CropGPT - Cocoa - Week 17

CropGPT - Cocoa

Global Cocoa Market Update – Week of April 27, 2025

This week's episode delivers an in-depth look at shifting cocoa production dynamics, emerging economic challenges, and evolving global demand trends impacting the cocoa industry.

Key Themes Discussed:

Ivory Coast Export Slowdown and Mid Crop Concerns
Cocoa shipments from Ivory Coast increased 11.3% year-over-year to 1,480,000 metric tons — a stark deceleration compared to the 35% surge seen last December. The upcoming mid crop is forecast at 400,000 metric tons, a 9% decline year-over-year, driven by dry weather. Political instability, marked by the exclusion of opposition leader Tidjane Thiam from elections, adds to market risks.

Ghana's Cocoa Production Challenges Deepen
Ghana, the world’s second-largest cocoa producer, has revised its production forecast downward for the second time this season to 670,500 metric tons. The persistent spread of swollen shoot disease, affecting over 40% of productive capacity, underscores the sector’s structural challenges, with replanting efforts hampered by critical funding shortages.

Brazil’s Ambitious Production Expansion
In contrast, Brazil is pursuing aggressive growth. Through Schmidt Agricola’s large-scale, high-density cocoa plantations, Brazil aims to boost production dramatically, with projections of reaching 1.6 million metric tons over the next decade. While promising, risks around genetic uniformity and disease susceptibility remain.

Global Market Overview: Demand Holds, Pressures Mount
Grindings in major regions such as North America, Europe, and Asia saw less-than-expected declines, suggesting steady demand resilience despite elevated cocoa prices. The International Cocoa Organization projects a global surplus, offering slight relief, but market dynamics remain heavily influenced by regional production risks, supply chain disruptions, and geopolitical uncertainties.

Sustainability and Innovation Trends
Efforts like Luker Chocolates’ sustainable initiatives in Colombia highlight how technology-driven, eco-friendly practices may become key to stabilizing global cocoa production and reducing long-term price volatility.

Strategic Implications:

• Supply Volatility:
  Structural production challenges in West Africa, particularly disease outbreaks and political risks, will continue to shape global supply concerns.
• Emerging Producers:
  Brazil’s scale-up could alter traditional market dynamics, creating more competition for West African cocoa exporters over the next decade.
• Demand Shifts:
  Despite price pressure, resilient grindings suggest strong underlying consumer demand, particularly for premium and sustainably sourced chocolate products.
• Sustainability as a Growth Lever:
  Producers investing in sustainable agriculture and technological innovation may gain competitive advantages in an increasingly ESG-focused market environment.