Cocoa powder market forecast for July–December 2025

Cocoa Powder Market Outlook | July – December 2025

Executive summary

After the most turbulent 18‑month stretch the cocoa complex has seen in six decades, prices are finally retreating from the \$10 000+/t extremes reached in Q1‑2025. Cocoa beans are trading just under \$8 000 t‑1 in early July, down almost 19 % month‑on‑month but still far above the long‑term average. The fundamental backdrop is shifting from deep deficit to the first tentative signs of surplus, yet supply risks remain elevated and demand has started to bend rather than break.

For cocoa powder specifically, the butter‑powder ratio has normalised: butter ratios have collapsed to \~2.4 while powder ratios are holding near 1.25. That means powder prices have not fallen as fast as beans, cushioning processors but limiting discounts for users of natural and alkalised powder.

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### 1. Where we are coming from

| Key metric | 2024 | H1‑2025 (actual) | Comment |

| ------------------- | ------------------------------------- | -------------------------- | -------------------------------------------------- |

| Global bean balance | –441 000 t deficit | \~–140 000 t deficit\* | Smaller shortfall as crops recovered slightly. |

| Cocoa futures high | \$12 931 t‑1 (Dec‑24) | \$10 920 t‑1 peak in May | Highest nominal price since 1977  |

| Q1‑25 grindings | EU –3.7 %, Asia –3.4 %, NA –2.5 % y/y | | Demand down but better than feared  |

\*ICCO estimate for the 2024/25 crop year.

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### 2. Supply fundamentals for H2‑2025

| Driver | Direction | Detail |

| -------------------------------------- | ----------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |

| West Africa main crop (starts Oct) | ↑ (mild recovery) | Ghana expects a rebound after its worst harvest in a decade, thanks to better rainfall and replanting support. Ivory Coast quality remains a concern after mid‑crop rejections . |

| Latin‑American expansion | ↑ | Ongoing acreage growth in Ecuador and an industrial mega‑farm in Brazil could add incremental supply; impact limited before 2026 but sentiment‑heavy . |

| 2025/26 global balance | Surplus 0.3 Mt | Commodity Risk Analysis projects the first surplus in three seasons (≈325 000 t). |

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### 3. Demand and grindings

* Price elasticity is finally visible. First‑quarter grind data show a low‑single‑digit decline on all three major continents, the weakest volumes since 2017 .

* Confectionery reformulation. Major chocolate makers are downsizing bar weights or switching to higher‑sugar recipes to cope with cost inflation . This chiefly lowers cocoa‑butter offtake; powder demand for beverages and baking remains relatively stable, especially in Asia.

* Forward bookings stabilising. Open interest on ICE futures is thin and volatility high, but bean imports into Asia rose 4 % in May as traders rebuilt working stocks.

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### 4. Price outlook (beans ➜ powder) for July‑December 2025

| Scenario | Assumptions | Bean range (US \$/t) | Powder price\* (US \$/kg, CIF Europe) |

| ------------------------------- | -------------------------------------------------------------------------------- | -------------------- | ------------------------------------- |

| Baseline (60 % probability) | West African main crop +6 % y/y; grindings –2 % y/y globally; USD broadly stable | 6 800 – 8 200 | 3.30 – 4.20 |

| Bullish weather shock (25 %) | Late‑season black‑pod or Harmattan damage cuts Ivorian crop 10 % | 8 500 – 10 000 | 4.50 – 5.50 |

| Bearish demand slump (15 %) | Euro‑zone recession, Asian grindings –6 % y/y | 5 500 – 6 500 | 2.70 – 3.30 |

\*Powder price derived from bean price × powder ratio 1.25 – 1.30 and average conversion costs.

Medium‑term anchor: Both J.P. Morgan and IG analysts see prices gravitating toward \$6 000 t‑1 once the market digests the 2025/26 surplus.

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### 5. Strategic implications for buyers

1. Layer forward cover now for Q4‑25 needs. Powder offers below \$3.50 kg‑1 re‑emerged last week in Rotterdam; that is a 35 % discount to January highs but only 10 % above the five‑year mean.

2. Watch the butter‑powder swing. Butter ratios have normalised, but any fresh supply scare will first lift butter; powder could lag, giving users a brief cost‑hedge window.

3. Diversify origin risk. Consider sourcing part of your powder requirement from Latin America or Indonesia to reduce exposure to West‑African logistics and policy shocks.

4. Quality premiums widening. High alkalised powders (≥22 % fat) are commanding \$200‑250 t premiums over natural. Lock in specs early.

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### 6. Key risk factors to monitor

| Risk | Bias | Monitoring trigger |

| ------------------------------------------------ | ---------------------------------- | ---------------------------------------------- |

| El Niño‑like dryness in Aug‑Sep | ↑ Prices | NOAA seasonal outlooks; soil‑moisture indices. |

| Further tree‑disease outbreaks (CSSV, black‑pod) | ↑ | Ghana Cocoa Board field reports. |

| Macro shock (Fed easing or EM FX crisis) | ↓ | DXY moves, INR/US\$ for Indian buyers. |

| Regulatory shifts (EU Deforestation Regulation) | ↑ for sustainable‑certified powder | Implementation guidance due October 2025. |

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### 7. Take‑away for gr8‑value.com clients

* The worst of the 2024/25 price spike appears behind us, but cocoa powder will stay structurally expensive through year‑end.

Build a *blended procurement strategy**: 40 % spot (to benefit from any further slide), 40 % six‑month fixed, 20 % options‑based collar for upside insurance.

Keep an eye on *October‑December shipping slots**—freight markets are tightening again out of West Africa, and lead times are stretching to 7 – 8 weeks.

> Need a tailored cover strategy or access to origin‑diverse powder lots?

> Contact the GR8‑Value trading desk—we’ll quote live CIF Nhava Sheva and Rotterdam positions aligned with your fat content and colour specs.

(All forecasts are indicative, based on publicly available data and should not be construed as trading advice.)