London cocoa futures fell sharply on Friday, easing a recent advance after touching a five-month peak a day earlier. Contracts on the London market dropped 2.8% to 3,821 per tonne following Thursdays high of 4,014 per tonne.
Across the Atlantic, New York cocoa futures moved lower as well, slipping 2.5% to $5,113 per tonne. The two major benchmarks showed parallel weakness as traders adjusted positions after the short-lived surge in prices.
Factors cited by Rabobank
Rabobank offered a concise read on the drivers behind recent price action. The bank highlighted three influences that have shaped market sentiment: the transition toward an active El Ni f1o event, easing geopolitical tensions in the Middle East, and a slow start to development of West Africas 2026/27 main cocoa crop.
On the outlook for the season, Rabobank expects a surplus in 2026/27. The bank also commented that risk premiums attributed to El Ni f1o appear to be priced somewhat high relative to its assessment.
Market context and dynamics
Thursdays move to 4,014 per tonne represented a five-month high for London contracts, a level that proved unsustainable into Fridays session. The subsequent pullback re-priced some of the near-term weather and geopolitical concerns that had supported the earlier rally.
While the week saw volatility, Rabobanks view of a potential surplus in 2026/27 frames the recent retracement as part of a broader seasonal and fundamental assessment rather than a definitive change in structural supply and demand balances.
What remains uncertain
Primary uncertainties noted in market commentary include the actual progression of the El Ni f1o event and the pace of development for West Africas main crop. Those elements are likely to keep price movements sensitive to new crop and weather updates in the near term.
For now, both London and New York cocoa benchmarks have moved down from their peak levels, reflecting a consolidation after a brief period of elevated prices.