Cocoa's been taking a beating lately and honestly, the cocoa market news right now is pretty straightforward - too much supply, not enough buyers willing to pay up. Watched the May contract drop over 2% on Monday and London cocoa fell even harder at 3.45%. Prices are still above last week's lows but the pressure's definitely on.

What's interesting is how the math just isn't working for buyers anymore. Ivory Coast and Ghana are holding firm on their official prices, but they're so far above what the world's actually paying that nobody's biting. Ghana already cut their farmer payouts by nearly 30% for next season, and Ivory Coast is looking at a 35% cut when the mid-crop starts in April. Even with those cuts coming, international buyers are staying on the sidelines. Result? Cocoa inventories just hit a 5-month high - over 2.1 million bags sitting in storage.

The broader cocoa market news story here is demand is just dead. Barry Callebaut, the massive chocolate maker, reported a 22% drop in cocoa sales volume last quarter. Chocolate's gotten so expensive that consumers are basically saying no thanks. European cocoa grinding fell 8.3% year-over-year in Q4 - worst quarterly number in 12 years. Asia's grinding is down 4.8%, and North America's basically flat. When the world's chocolate makers are grinding less cocoa, that tells you everything about where demand is.

On top of that, West Africa's having a really good growing season. Pods are bigger and healthier than last year, and the harvest that just kicked off in Ivory Coast looks solid. One analyst said pod counts are 7% above the five-year average. Plus Nigeria's shipping more cocoa - exports jumped 17% last month. All of this is just adding to the supply pressure.

The forecasts back this up. StoneX is calling for a 287,000 metric ton surplus in 2025/26 and 267,000 MT the following year. International Cocoa Organization said global stocks are up 4.2% year-over-year. For context, they're also calling this the first global surplus in four years, so it's a meaningful shift in the market.

Not everything's bearish though. Ivory Coast production is expected to fall about 10.8% next season, and Nigeria's projecting an 11% drop too. Farmers in Ivory Coast are also shipping less cocoa to ports compared to last year - down 3.7% through late February. So there are some bullish signals buried in here, but they're getting drowned out by the supply and demand imbalance.

Rabobank just cut their surplus forecast to 250,000 MT for 2025/26, down from 328,000 MT they predicted back in November, so maybe the worst of the supply glut is pricing in. But for now, the cocoa market news is all about oversupply meeting weak chocolate demand. That's the dynamic keeping prices under pressure. Interesting to watch how this plays out when production actually starts falling next season.