There have been conflicting news stories about the recent weather in West Africa cocoa areas.  Nearly 50% of global cocoa production occurs in Ghana and the Ivory Coast.  The crops are mainly grown in the area marked with a red circle below.

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Too Much Rainfall?

Rainfall has been well above normal the past few weeks. Some news reports mention concerns about it affecting the the harvest and sale of the mid-crop (May-Aug).  The roads have been impassible at times. Another worry is black-pod disease caused by a fungus.  Too much rain provides better conditions for the disease to occur and spread.  June had above normal rainfall, with the past week being particularly wet (+200%-600% of typical rainfall in spots).

rainfall, africa, cocoa

SOURCE: NOAA/CPC

On the other side of things is the sentiment that this rainfall is ‘great’ for the developing main crop (grows May-Sept).  We’ve had strong rainfall compared to the last few years.  The ample soil moisture can be viewed as beneficial, rather than detrimental to the supply/demand outlook.  Typically, rainfall dies down in June, as the Inter Tropical Convergence Zone moves north. Precipitation will pick up again in August and September.  Traders will be watching to see if too much or too little rainfall occurs. The main crop harvest will set the scene for cocoa prices in the months to come. Only our paid subscribers will receive our proprietary weather forecast and production outlook.