Cocoa enters H2 2026 in a severe supply crisis, trading at approximately $8,500/tonne — up 120% year-over-year. The International Cocoa Organization (ICCO) forecasts a 400,000 tonne deficit for 2026/27, the third consecutive deficit year.
Ivory Coast, producing 40% of global cocoa, is forecast at 2.2 million tonnes, down 15% from 2025. The crop faces multiple headwinds: swollen shoot virus has infected 20% of plantations, aging tree stocks (30% over 30 years old) have declining yields, and erratic rainfall patterns have stressed production.
Ghana's crop is forecast at 700,000 tonnes, down 20% year-over-year, the lowest in 20 years. The Cocoa Board (COCOBOD) has struggled with farmer payment delays, reducing input application and farm maintenance.
Grinding data shows a 5-7% decline in H1 2026, indicating demand destruction as chocolate manufacturers reformulate products with less cocoa content or substitute with alternatives.
ICCO price projections for H2 2026 cluster at $7,000-10,000/t, with extreme volatility expected.
Cocoa buyers must secure H2 requirements immediately at current $7,500-9,000/t levels. The structural deficit and West African supply crisis create significant upside risk. For chocolate manufacturers, evaluate cocoa butter equivalents (CBEs) and reformulation strategies where labeling permits. Budget $8,000-12,000/t for 2027 as tree rehabilitation takes 3-5 years to impact production.