Just checked the cocoa futures and wow, prices are getting hammered right now. May NY cocoa down over 5% today hitting contract lows, and London cocoa also posting new 2.75-year lows. This whole seven-week downtrend is pretty brutal to watch.

The supply story is wild - basically too much cocoa flooding the market. StoneX forecasted a 287,000 MT global surplus for 2025/26, and ICCO reported global cocoa stocks up 4.2% year-over-year to 1.1 MMT. ICE inventories just hit a 5.75-month high at 2.15M bags. Both Ivory Coast and Ghana just slashed official farm-gate prices by 30-35%, which tells you everything about the oversupply situation.

On top of that, West African growing conditions are looking really favorable this season. Farmers are reporting larger and healthier cocoa pod development compared to last year, and the mid-crop in Ivory Coast is expected to be solid - estimated at 400,000-450,000 MT. Tropical General Investments Group noted that cocoa pod counts are running 7% above the five-year average. That's pushing more supply into the market when nobody really wants it.

Demand is basically dead. Barry Callebaut, the world's biggest chocolate maker, reported a 22% drop in cocoa division sales volume last quarter because consumers are refusing to pay chocolate prices. European cocoa grindings fell 8.3% year-over-year in Q4 - the worst quarterly performance in 12 years. Asian grindings down 4.8%, North American barely flat at +0.3%. Mondelez said the latest cocoa pod counts are materially higher than last year's crop, which is just adding to the bearish pressure.

Nigeria's pumping out more cocoa too - December exports up 17% year-over-year. Only real bullish thing is both Ivory Coast and Nigeria projecting production cuts for 2025/26, but that's not enough to offset what's happening now with all this supply and zero buyer interest.