- Cocoa futures are up around 1–2% as West African supply risks, weaker crop expectations, lower ICE inventories and a softer U.S. dollar support prices.
- Managed Money remains net short and added more bearish exposure, with the net position at -6,667 contracts as of August 11.
- Commercials are also net short but reduced part of their short hedges, while falling open interest points to lower overall market participation rather than aggressive new positioning.
- Cocoa futures are up around 1–2% as West African supply risks, weaker crop expectations, lower ICE inventories and a softer U.S. dollar support prices.
- Managed Money remains net short and added more bearish exposure, with the net position at -6,667 contracts as of August 11.
- Commercials are also net short but reduced part of their short hedges, while falling open interest points to lower overall market participation rather than aggressive new positioning.
The move higher is also supported by lower production forecasts and reduced estimates for the global supply surplus. Another factor is the EU’s anti-deforestation regulation, which could complicate exports of some cocoa to Europe due to geolocation and traceability requirements. The market is also watching a gradual decline in ICE-monitored inventories and a weaker U.S. dollar, which improves the purchasing power of foreign market participants.
On the other hand, gains are being limited by still-high port arrivals and relatively good physical availability of cocoa. Ghana reported that production in the 2025/26 season reached 750,000 tonnes, up 25.6% year over year. Demand remains another risk, as some chocolate manufacturers are reducing cocoa usage or reformulating products after the period of very high prices. To take a deeper look at the cocoa market, it is worth examining the latest Commitment of Traders report.
What does COT positioning show in the cocoa market?
The latest COT report shows that Managed Money funds remain net short cocoa and have increased their bearish exposure further. As of August 11, they held 22,955 long contracts versus 29,622 short contracts, resulting in a net position of -6,667 contracts. Over the week, short positions increased by 2,147 contracts, while longs rose by only 150, meaning speculative positioning deteriorated by almost 2,000 contracts on a net basis.
A different picture emerges from the Producer/Merchant/Processor/User category, which represents commercial participants directly involved in the physical cocoa market. Commercials held 53,235 long contracts and 73,711 short contracts, giving a net position of around -20,476 contracts, although their short bias narrowed slightly over the latest week. Short positions fell by 3,717 contracts, while longs decreased by 3,285, making the group’s net position slightly less negative.
- Managed Money (large speculators) increased its net short bias, indicating continued caution among funds toward the cocoa price outlook.
- Commercials (producers and other physical-market participants using futures mainly for hedging) remain clearly net short, but have partially reduced their short-side hedges.
- Open interest fell by 12,507 contracts, suggesting a broader reduction in market participation rather than aggressive new position building.
- Taken together, the two groups provide a mildly bearish speculative signal, but not an extreme one: funds are adding shorts, while commercial participants are not increasing their net short exposure.
In practice, the most important signal at the moment is the behavior of Managed Money — speculative funds are leaning more clearly to the downside. Commercial positioning should not be interpreted as a straightforward bearish signal, because producers and processors primarily use futures to hedge their exposure to physical cocoa, and their natural position is often net short.
Source: CFTC
COCOA (D1 interval)
Source: xStation5
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