Key Moments
- Cocoa futures in New York rose 0.9% on Wednesday, marking a second straight session of gains.
- Citigroup Inc. reduced its global cocoa oversupply forecast by 41% to 79,000 tons for the current season.
- Traders monitored both the smaller projected surplus and potential index-related buying as support for prices.
Market Reaction to Tighter Surplus Projections
Cocoa prices advanced in New York for a second consecutive session on Wednesday, as traders reassessed the balance between supply and demand in light of a reduced surplus outlook and the prospect of additional index-driven buying interest.
Cocoa futures gained 0.9%, adding to the prior session’s rebound following a decline on Monday. The move higher came as market participants digested newly revised estimates for the current season’s global supply picture.
Citigroup Cuts Oversupply Estimate
Recent changes to global cocoa supply forecasts have pointed to a smaller-than-previously-expected surplus. Citigroup Inc. sharply lowered its projection for market oversupply by 41%, bringing its estimate down to 79,000 tons.
This downgrade in the expected surplus has prompted a reassessment of price risk among investors, as a tighter buffer between production and consumption can alter sentiment toward the commodity.
Price Drivers: Surplus Outlook and Index Buying
The latest price action reflected market responses to these updated supply projections. The combination of a reduced anticipated surplus and the likelihood of index-related buying activity has been seen as contributing to upward momentum in cocoa futures.
Key Figures at a Glance
| Metric | Latest Detail |
|---|---|
| Price move in New York cocoa futures (Wednesday) | +0.9% |
| Citigroup oversupply estimate reduction | 41% |
| Revised global cocoa surplus forecast | 79,000 tons |





