Cocoa prices - where we are and where we’re heading

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Dear customer,

The last four months have proven to be a period of relative price stability in the cocoa markets. I say relative because even though the cocoa price has fluctuated between £2000 and £3500/MT, it has mostly remained between £2350/MT and £3100/MT, which has felt much calmer than the wild fluctuations of 2024 and 2025!

Line chart showing cocoa prices from December 2025 to early June 2026. Prices start above 4,300 in late December, decline steadily through January and February, reaching a low of around 2,200 in early March. Prices then remain relatively stable between 2,300 and 2,600 through April before rising sharply in early May to approximately 3,500. After the peak, prices fall back and fluctuate between 2,900 and 3,200 through late May and early June. Trading volume is displayed as grey bars along the bottom of the chart.

Read on for:

Where cocoa prices sit and where they're heading next
Why premiumisation is the trend to watch
The rise of cocoa-free chocolate
Fresh launches to inspire your range
A closer look at the risks ahead

Since the beginning of 2026, we have seen two very substantial price cuts in chocolate from Callebaut, in January and then April, with corresponding price cuts across most chocolate brands.

We now feel that the next move in chocolate prices, whenever it may be, is more likely to be up than down. For those of you who are interested, there’s more about the main factors that might determine the trajectory of cocoa prices in 2026 H2 and 2027 at the end of this newsletter.

News & Trends

There have been two strong trends in evidence recently.

Premiumisation

There are clear signs that the premium end of the chocolate market is recovering strongly and we are seeing lots of new and imminent product launches as well as growing interest in quality and differentiation.

Callebaut have recently launched “Focus for Growth”, their new strategic plan and Hein Schumacher, their new CEO, has stated that they are prioritising the Gourmet division, with an emphasis on Specialities and premium offerings.

As part of their “Masters of Taste” evolution, they have refined their portfolio to make it simpler to navigate chocolates, decorations and cocoa powders. Their new Taste Wheel lets you explore Callebaut’s entire range through intuitive flavour families.

As a Callebaut Premium Partner, we are proud to stock the widest selection of Callebaut products in the UK, all available through our dedicated Callebaut webshop.

We also continue to see some exciting and innovative new products from Valrhona, from the Matcha-infused chocolate to super-premium gianduja and raspberry croissant sticks.

Cocoa-Free Chocolate & Compounds

At the value end of the market, there has been a growing focus on cocoa-free chocolate in particular as a way to mitigate the risks of future supply disruption and price volatility in the cocoa markets due to the increasing risks to supply.

From Mondelez and Nestle, to Callebaut and Cargill, there has been growing experimentation with cocoa-free products as a substitute for chocolate in certain applications where there is no discernible difference in taste, mouthfeel or appearance.

At Keylink, we have been very excited to partner with Win-Win, inventors of the UK’s first cocoa-free chocolate alternative. If you are looking for price stability along with strong ethical and sustainability credentials, we would be very happy to discuss how Win-Win might benefit your business.

In Other News

Some of our other recent product launches include British-made Favorich milk chocolate 30%, exciting new décor items for bakery and chocolate - including sparkling dark chocolate Crispearls - chopped and whole dates… and a pleasingly quirky croissant-shaped chocolate mould!

A Deeper Look at the Risk Factors for the Cocoa price

Current Demand

There has been a lot of talk of the “demand destruction” caused by the sharp spike in cocoa prices in 2024, which in turn fed into much higher chocolate prices. This was reflected in shrinkflation, substitution and just lower consumption.

However whilst demand remains fragile, there are signs of a cautious recovery, cautious because the fear of renewed volatility remains, along with the reality of weak consumer sentiment and persisting inflationary pressures in the wider economy.

This Year’s Crop

It’s increasingly certain that 2025-26 will prove to be a year of recovery for cocoa harvests resulting in another much needed global surplus, following the small surplus in 2024-25. The average consensus forecast for 2025-26 is still for a healthy surplus, but forecasts are increasingly being scaled back due to continuing adverse weather.

Bar chart showing the global cocoa production balance from 2021–22 to the 2025–26 estimate. The market recorded deficits of approximately 220,000 tonnes in 2021–22, 100,000 tonnes in 2022–23 and a significant 500,000 tonne deficit in 2023–24. This is followed by a return to surplus, with around 50,000 tonnes in 2024–25 and an estimated 250,000 tonne surplus in 2025–26. Red bars indicate deficits and green bars indicate surpluses.

It’s also encouraging to look at the underlying production and grindings (the proxy for demand) data. This shows that not only are we expecting a surplus, but that both global production and demand is actually recovering significantly, albeit that demand is growing a little more cautiously.

Bar chart comparing global cocoa production and grindings from 2021–22 to the 2025–26 estimate. Production and grindings were closely matched in 2021–22 and 2022–23, with grindings slightly exceeding production. In 2023–24, production fell sharply to around 4.35 million tonnes while grindings remained near 4.8 million tonnes, creating a significant supply deficit. Production recovered in 2024–25 and is estimated to reach approximately 5.1 million tonnes in 2025–26, exceeding projected grindings of around 4.85 million tonnes. Blue bars represent production and peach bars represent grindings.

Structural Factors

By this, we mean the underlying systemic challenges facing the main producer countries, of which there are quite a few.

Ageing plantations – Under-investment in planting new trees has been a systemic issue for some time which is increasingly felt as lower and reducing crop yields in West Africa, especially by comparison with Ecuador for instance.

Cacao Swollen Shoot virus (CSSV) – this plant disease spread by mealybugs is especially prevalent in West Africa with infections spreading undetected for years. In Ghana, it is estimated that 30% of the cacao trees are already infected and the infection rate is estimated to be equally significant in the Ivory Coast, and growing.

CSSV damages trees and reduces their yield before the trees ultimately die. There is no treatment for the disease and the only option is to rip them out and plant new ones, which take 3-4 years to start producing cacao pods.

Black Pod disease – this is a fungal disease prevalent in West Africa which affects cacao trees and can reduce yields by up to 30% each year. The spread of this fungus is associated with heavy rains and high humidity, causing the pods to turn brown and black. Unlike CSSV, better land management and fungicides can help mitigate the spread of this fungus, but that requires investment which is not always available.

Government Factors – in Ghana, all the cocoa is ultimately bought by the Ghana Cocoa Board (COCOBOD). They are facing major liquidity problems which has left them unable to fulfil some of their buying commitments or to pay farmers. If this is not resolved effectively, it will no doubt impact Ghanaian yields in the future, for example by limiting farmers’ access to fertilisers, which are already in short supply due to the war in the Middle East.

El Niño – this is the biggest source of concern as we move towards the 2026-27 season. Early signs show the formation of a significant El Niño event which could significantly affect production in Ecuador and West Africa.

Three globe maps comparing Pacific Ocean sea surface temperature anomalies in December 2025, March 2026 and April 2026. The maps show the main El Niño monitoring region across the equatorial Pacific, with blue areas representing cooler-than-average temperatures and orange to red areas representing warmer-than-average temperatures. Between December 2025 and April 2026, warmer water becomes more prominent across parts of the central and eastern Pacific, indicating strengthening El Niño-like conditions. A temperature scale ranges from -3°C to +3°C

The charts above are from an excellent BBC article on 2nd June

In the El Niño phase of this oceanic cycle, sea surface temperatures rise significantly in the equatorial and eastern Pacific Ocean. This warming typically leads to hotter, drier conditions in West Africa but increased rainfall and flooding in South America, Ecuador in particular.

Part of the concern around the El Niño derives not just from the fact that we are transitioning to an El Niño period, but from the observation that climate and weather fluctuations are becoming more extreme, which is never good for agriculture.

Conclusion

Whilst there are growing concerns about cocoa production, in particular due to the threat of a strong El Nino building, demand also remains subdued. So whilst we could well see prices ticking up a little in the second half of 2026, we do not currently expect a return to the destructive volatility of the last two years.

Sanjeev Ramchandani

Managing Director

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News & Trends

A Deeper Look at the Risk Factors for the Cocoa price

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