Ivory Coast Drought and Weaker Pound Boost Cocoa Prices
Cocoa prices have been on an upward trend for three consecutive sessions, with December ICE NY cocoa (CCZ26) closing up +62 (+1.12%) and December ICE London cocoa #7 (CAZ26) closing up +55 (+1.33%). The recent increase is attributed to dry conditions in West Africa, specifically the Ivory Coast, where forecasts indicate below-normal rains over the next week will stress crops and reduce output for the 2026/27 crop season.
The weaker British pound has also contributed to the gains in London cocoa prices, as a falling pound boosts the value of cocoa priced in sterling. This comes after the pound hit a 2.75-month low on Thursday.
Cocoa prices had been under pressure for three weeks and reached 1.75-month lows on Tuesday due to higher output expectations from the Ivory Coast. However, the latest crop assessments show below-average cherelle formation on cocoa trees, signaling a weak outlook for the main harvest starting in September.