Caught cocoa bouncing back on Monday - NY futures up 3.5% and London up 2.4%. Prices had gotten absolutely crushed over the past couple weeks, hitting 2-year lows, so this rebound makes sense given the dollar weakness we're seeing.

What's interesting is that West African producers are basically sitting on their hands right now. Ivory Coast shipments are running 3% lower year-over-year through January, and with global stocks actually climbing 4% to 1.1 MMT, there's not much urgency to push product out at these prices. Nigeria's also cutting exports - down 7% in November and projecting an 11% production drop for next season.

But here's the thing - demand is still pretty weak. Barry Callebaut reported a 22% drop in cocoa sales volume, and grinding numbers across Europe, Asia, and North America all came in soft. European grindings fell 8.3%, which is the worst Q4 in 12 years. People just aren't buying chocolate at these price levels.

The West African harvest is looking decent though - bigger, healthier pods than last year, with pod counts running 7% above the five-year average. So we're not dealing with a supply crunch story here. More like a wait-and-see situation where producers are holding back, demand is meh, but the market's finally acknowledging that global surplus estimates got cut pretty hard. ICCO went from projecting a 142k MT surplus down to just 49k MT. That's the real support for prices right now.