Cocoa Market Summary - February 2026

Current Market Situation

As of February 18, 2026, cocoa futures have experienced a significant decline, plunging over 45% since the beginning of the year. Today's trading saw a drop of more than 6%, with prices reaching their lowest levels since September 2023. This decline has effectively erased the speculative rally that occurred in 2024.

Factors Influencing the Decline

The primary drivers behind the cocoa sell-off include:

• Price Cuts in Ghana: Ghana, the world's second-largest cocoa producer, recently reduced the farmgate price paid to farmers by nearly 30%. This move has created a ripple effect in the market.
• Côte d’Ivoire's Stance: Côte d’Ivoire, the largest cocoa producer, has announced it will not adjust its farmgate price until the end of the current main crop season on March 31. However, there are indications that it may consider a price reduction in response to market conditions.
• Weak Demand: Buyers are hesitant to purchase cocoa at the official prices set by Ghana and Côte d’Ivoire, contributing to the downward pressure on prices.

Market Outlook

The outlook for cocoa prices remains bearish, with expectations of continued pressure due to softening demand and an improving crop outlook in West Africa. Analysts predict a potential supply-demand surplus that could extend through 2027. However, structural production risks may limit the extent of the sell-off.

Despite the current bearish trend, there is a possibility for volatility. A rebound in demand triggered by lower prices could shift market sentiment rapidly. The daily Relative Strength Index (RSI) for cocoa has dropped to around 20, indicating extreme oversold conditions, which is unusual for this market.

Conclusion

In summary, the cocoa market is facing significant challenges with a steep decline in prices driven by reduced farmgate prices in Ghana, potential adjustments in Côte d’Ivoire, and weak demand. While the market outlook suggests continued pressure, the potential for volatility remains as demand dynamics could change with price adjustments.