Cocoa market stable for first time since 2022

Cocoa market trends summary: Is stability here to stay?

• Cocoa prices peaked at $10.75/kg in January 2025
• Prices fell in spring 2025 as global production recovered
• European cocoa grind dropped 7.2% year-on-year in Q2 2025
• Speculative trading fell 80% from peak, reducing market volatility
• Political unrest and dry weather in Ivory Coast threaten future supply

Food and beverage manufacturers are breathing a sigh of relief, as industry experts confirm the cocoa market has finally stabilised.

Prices for the prized commodity began to climb back in 2022, when adverse weather in West Africa (the world’s largest supplier region) led to severe supply shortages.

Since then, cocoa prices continued to rise, shooting up to a record high of $10.32 (€8.85) per kilogram in December 2024, before continuing to climb into the new year.

“This surge was the largest seen in over six decades,” says Nidhi Jain, commodity specialist at procurement and supply chain advisory firm WNS Procurement.

The shift put huge strains on industry stakeholders and led to inevitable price increases for customers at the checkout.

However, improving conditions through spring 2025 saw global cocoa production recovering and prices beginning to fall.

Now, the market has levelled off, sitting at around $7 per kilogram. And while this is still significantly higher than the $2-3 average of pre-2022, its predictability will come as a welcome change to manufacturers who’ve struggled through the recent volatility.

Cocoa market stable

According to commodity intelligence platform Vesper, the stabilisation of the cocoa market can be attributed to a number of factors, affecting both demand and market activity.

Firstly, demand has weakened significantly, especially in Europe, where cocoa processing (or “grind”) dropped by 7.2% in the second quarter compared to last year - its lowest level since the COVID-19 downturn in 2020. This reflects reduced consumer appetite for chocolate and related products.

Supporting this, Nielsen data from August shows sharp declines in unit sales volumes (down as much as 19.4%), even as prices rose by double digits, indicating that higher costs are discouraging purchases.

On the financial side, speculative interest in cocoa has also waned. Managed money positions - essentially bets on price movements - have dropped dramatically from 68,000 contracts in December 2024 to just 13,400 in August 2025.

The latest data from the Cocoa Futures Trading Commission (CFTC) shows net long positions (bets on rising prices) have fallen by 80% since their peak, and overall market liquidity is down, as shown by declining open interest.

Together, these trends suggest that both consumer and investor enthusiasm for cocoa has cooled, helping to stabilise prices.

Cocoa market: September 2024-August 2025

(Source: YCharts)

What does this mean for manufacturers?

There’s no doubt that stabilisation of the cocoa market is good news for food and beverage manufacturers. But, more than that, it represents a huge opportunity.

Cocoa manufacturers are facing ongoing margin pressure, explains Justine White, senior market insights analyst at Vesper. This is prompting strategic changes across the supply chain. Major players like Barry Callebaut have repeatedly lowered their sales volume forecasts, now expecting a 7% decline for the year, while brands such as Hershey and Lindt have responded with steep price hikes - over 10% and 15.8% respectively.

To cope with shrinking margins, many processors have voluntarily reduced cocoa bean purchases by around 20% since January, and some, like Cargill, have even paused grinding operations due to poor bean quality.

Interestingly, while general inflation in Europe appears to be stabilising, chocolate and confectionery prices remain exceptionally high. If employment stays strong and broader prices ease, manufacturers may be able to hold onto these elevated price levels without losing more sales volume, as consumers begin to feel less financially strained.

“For manufacturers it is an interesting juncture,” says Vesper’s White.

Will cocoa market stability last?

Unfortunately, the current stability within the cocoa market is unlikely to last for long. In fact, it might not even make it to the end of the year.

Political risk: Ivory Coast’s 25 October presidential elections pose significant risks, with major opposition candidates disqualified and protests already occurring. “Historical precedent suggests potential supply disruptions,” says Vesper’s White.

Weather sensitivity: Recent reports showed the Ivory Coast had experienced the driest 30-day period in 46 years - from 18 July to 15 August, resulting in pod mortality rates 15-20% above May forecasts.

However, Belgium’s CRA weather observations says rainfall since 18 August has been above average across growing regions, offering hope of a strong start to the new season. And, earlier this month, confectionery giant Mondelez reported that pod counts were strong, causing prices to dip.

Added to this, structural vulnerabilities threaten the market, resulting from historically low stock-to-usage ratios.

The future of the cocoa industry

While cocoa’s recent stabilisation offers a welcome reprieve for manufacturers, the market remains fragile.

Political uncertainty, climate volatility, and structural supply issues continue to cast a shadow over long-term prospects.

For manufacturers, this is a critical moment to reassess supply strategies, pricing models, and consumer engagement.

Whether this calm marks the beginning of a more predictable era or just a brief pause before the next storm, one thing is clear - agility and foresight will be key to navigating cocoa’s complex future.