Cocoa Prices Plummet to Year-Low Ahead of West African Harvest
Cocoa prices have plummeted to their lowest point in over a year, with the commodity now trading at levels not seen since March 2024. This downturn comes as the main cocoa harvest in West Africa, led by top producer Ivory Coast, is set to begin. Meanwhile, experts predict a significant drop in production for the upcoming season.
The Conseil Café-Cacao (CCC) anticipates a noticeable decrease in cocoa production for the 2025/2026 season. This prediction, coupled with the current global surplus of 142,000 tonnes for the 2024/2025 season, has contributed to the recent price decline. Cocoa's price has already fallen by 50% since peaking in December 2024.
High prices in 2024 deterred consumers, leading to decreased demand. Now, with prices hovering around the support zone of 5,870-6,000 USD per tonne, traders are watching closely to see if this level holds. Some investors are even betting on further price drops using Mini Future Optionsschein Put certificates.
As the West African harvest season commences, the cocoa market remains bearish, with opportunities for short positions. However, the situation may change as more information about the harvest becomes available. Traders are advised to keep a close eye on developments, with the support zone at 5,870-6,000 USD per tonne serving as a key test for cocoa prices in the coming months.
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