Rain Predictions in Ivory Coast Drive Down NY Cocoa Prices

Cocoa Price Movements: December ICE NY cocoa prices have dropped significantly by 4.85%, while September ICE London cocoa prices have seen a slight increase of 0.68%. The decline in NY cocoa is attributed to forecasts of rain in the Ivory Coast, prompting long liquidation in futures.

Weather Impact on Production: Concerns over cold and dry weather affecting cocoa plant development in West Africa have previously driven prices up. The lack of rain has been noted as the driest period for the Ivory Coast in 46 years, potentially impacting cocoa pod retention before the main harvest.

Quality and Export Issues: Quality concerns regarding mid-crop cocoa from the Ivory Coast are affecting prices, with processors rejecting poor-quality beans. Additionally, cocoa exports from the Ivory Coast have slowed down, although shipments are still up compared to last year.

Global Demand Challenges: Weakness in chocolate demand is negatively impacting cocoa prices, with major chocolate manufacturers reporting declines in sales volume. Furthermore, global cocoa grindings have decreased significantly in Europe and Asia, contributing to bearish market conditions.