KANSAS CITY — A recent Reuters’ poll of 12 analysts and traders showed expectations of weaker nearby cocoa bean futures prices by the end of 2021 as COVID-19 continues to suppress demand and global stocks continue to build.
The average of respondents’ replies showed expectations that the nearby New York cocoa future will end the calendar year near $2,438 per tonne, down about 6% from the Feb. 5 close of $2,587 per tonne. Nearby London futures were forecast to end 2021 near 1,644 lbs per tonne, down 3.2% from 1,699 lbs as of Feb. 5.
Ideas were that lingering effects of COVID-19 will continue to suppress global cocoa and chocolate demand during the year. Grindings have dropped about 10% in some regions as the pandemic sharply reduced out-of-home chocolate consumption, the report said. Despite expected recovery due to vaccinations, a large cocoa surplus still is expected this year.
The poll showed expectations of a global cocoa bean surplus of 218,000 tonnes at the end of the 2020-21 marketing year (Sept. 30), up sharply from a surplus of 19,000 tonnes at the end of 2019-20 as estimated by the International Cocoa Organization.
The surplus has been exacerbated by higher prices asked for cocoa beans from the Ivory Coast and Ghana resulting from the $400-per-tonne living income differential applied to the 2020-21 crop.
Production in the Ivory Coast was forecast at 2.17 million tonnes, up from 2.1 million tonnes in 2019-20, and in Ghana at 879,000 tonnes, up from 800,000 tonnes. An estimated 100,000 tonnes of beans have built up in the Ivory Coast in recent weeks, according to trade reports.