Kakao Market Decline: Record Second Year Begins

Cocoa Prices Continue to Decline

As we entered 2025, the commodity market, influenced by geopolitical tensions, has entered a new phase with climate conditions playing a decisive role in the agricultural group. Cocoa prices have recorded a historic annual decline of 48.1% due to diminished concerns over drought in West Africa and expected increases in production. The price of cocoa per ton finished the previous year at $6,065.

Cocoa Entered the New Year Under Selling Pressure

The price drop witnessed last year has carried over into the new year. Starting the year at $6,065, cocoa prices have decreased by 10.3% in the first 12 days of this year, falling to $5,443. Favorable weather conditions in West Africa continue to exert pressure on cocoa prices.

This year, the expected cocoa harvest in the Côte d'Ivoire and Ghana regions is strengthening optimism about farmers' production capacity.

Demand Expectations Weak

Although an increase in cocoa production is anticipated, demand is expected to remain weak. Farmers in the Côte d'Ivoire foresee that the recent unusual rainfall will positively affect cocoa production. Data on cocoa processing from Europe is also expected to confirm the weakness in demand.

Forecast and Investor Reactions

Rabobank Commodity Analyst Oran van Dort states that the decline in cocoa prices is largely attributed to technical factors and market volatility. High margin requirements and decreasing liquidity are triggering downward movement in the market.

Dort noted, "The anticipated surplus in upcoming harvest seasons will lead to a downward trend in prices," emphasizing that they maintain their expectations for price declines. Highlighting the fluctuations occurring in the cocoa market, the analyst stressed that both decline and a potential recovery remain possible.