Cocoa prices retreat after a rally, and the market remains focused on demand

Cocoa futures closed the week of June 6 at 3,762 USD/t in New York and 2,902 GBP/t in London. After a rally on Tuesday, the 2nd, driven by a technical move supported by weather-related concerns, a possible slowdown in Ivory Coast’s sales, and the expiration of volumes in certified stocks in New York, the market gave up its gains over the course of the week and closed lower on Friday. So far, there have been no significant changes in fundamentals. Nevertheless, the sector remains attentive to factors that could alter market sentiment, including demand, which is monitored primarily through cocoa bean grinding.

In this context, it is important to monitor the main processing region. Net cocoa bean imports by the European Union, calculated as imports minus re-exports, fell again in May. Cumulatively from October 2025 to May 2026, the indicator is 4.2% below the level recorded in the same period of the previous year.

Despite this, imports reached a record high in March for the month, following a recovery that began in January, when historic lows had been recorded. This recovery in the first three months of the year, combined with a 7.8% drop in the region’s grinding, contributed to a higher inflow of stocks in the first quarter of 2026, which was above the historical average and higher than that observed in the same period last year.

Although net import movements cannot be interpreted as having a direct impact on grinding, given the significant role of stocks in this dynamic, they reinforce an environment still influenced by the problems of recent cycles, marked by high prices and supply constraints throughout the year, which is also reflected in the behavior of certified stocks. At ICE Europe, certified (valid) stocks remain significantly below the historical average and the levels observed in the previous year, while at ICE US, there is relatively greater availability.

This difference can be explained, at least in part, by the origin of the beans. ICE US consists mainly of cocoa from Ecuador, while ICE Europe relies more on origins such as Ghana and Ivory Coast, which faced trade issues at the beginning of the year. When analyzing cumulative net imports by origin, a trend can be observed that may reflect this scenario. Imports from Ivory Coast are about 11% below the historical average, while other origins show an increase, notably Ecuador, whose volumes shipped to the region are approximately 5% above the average.

Given this scenario, the outlook for grinding remains uncertain in the short term. Despite the increase in cocoa bean inflows in the first quarter of 2026, certified stock volumes indicate that the actual availability of raw material is not yet uniform across markets, especially in Europe. Furthermore, the sector remains attentive to how falling prices may influence processing activity and whether part of this additional inflow will, in fact, translate into increased grinding.

Cocoa futures showed volatility throughout the week, with a brief high followed by a correction, in an environment with no significant changes in fundamentals but still sensitive to factors such as weather. In the European Union, net imports remain below the previous year’s level on a cumulative basis, despite a recent recovery that, combined with the decline in grinding, led to an increase in stock flows in early 2026. Nevertheless, certified stocks at ICE Europe remain historically low, in contrast to the higher availability at ICE US, reflecting differences in the origin of the beans. This difference continues to create uncertainty regarding the pace of grinding, especially given the recent drop in prices.