Market Briefing: Cocoa -17 July 2021

– European Q2 cocoa grinding rises to highest level in at least 10-years
– Germany’s Q2 cocoa processing up 18% y/y, Brazil’s June processing up 32.8% y/y
– Barry Callebaut nine-month sales volumes +3.4%, Q3 chocolate sales volumes up 21.2%

Production

– Cocoa volumes arriving at Ivory Coast’s ports dipped again in weekly comparisons, to a total of 13,000 tonnes (5-11 July), down from the 24,000 tonnes during the same week last season, as well as slightly below last week’s 14,000 tonnes. Nevertheless, cumulatively, supplies still appear to be abundant, with arrivals reaching 2.074 million tonnes by July 11, up 5.1% from 1.973 million tonnes over the same period last season.

Demand

– European cocoa processing figures for Q2 2021 rose to their highest level in at least 10-years and could potentially be its all-time peak for the quarter, the European Cocoa Association (ECA) indicated. Europe’s second-quarter cocoa grind increased by 13.6 % from a year earlier to 356,854 tonnes, compared to Q2 2020’s 314,108 tonnes. The new figure was also above market expectations of +7.5%, but below Q1’s 357,815 tonnes.
– Germany’s own second quarter 2021 cocoa grind also rose 18% on the year to 93,064 tonnes, its confectionery industry association BDSI said. Grindings rose because of increased industrial demand as the economy recovered from the impact of the coronavirus crisis, with quarterly grindings close to pre-pandemic levels, the association stated.
– Cocoa crushing in Brazil totaled 310,221 60-kilo bags (18,613 tonnes) in June, a decrease of 12.3% m/m but up 32.8% y/y.
– Swiss chocolatier, Barry Callebaut, saw its nine-month fiscal year sales volumes accelerate (+3.4%) with chocolate (+21.2%) in particular reporting a strong performance.

Trade

– In June, Brazil’s total cocoa exports were down 3% y/y to 4,775 tonnes, but up 9% y/y in value at $16 million, due to Bahian exports rising in both volume and revenue, according to the government official data (Secex). The state of Bahia’s exports were 3% higher y/y in volume and saw a 15% y/y hike in value, to 4,751 tonnes and USD16 million, respectively. From February to June, Brazilian exports tallied 49,229 tonnes according to data from Ilhéus port, but according to government data, it was lower at 38,005 tonnes. Brazilian industries have already reported that 43,212 tonnes will be released in the next weeks.

Price

– Cocoa futures recovered from last week’s eight-month lows with the New York hitting a 3½-week high, spurred by hints of improved market demand. September New York cocoa reached USD2,430 on Monday’s close (July 12), however, a stronger dollar capped further gains with prices ending at USD2,402 by Wednesday (July 14).

Source: https://vietnamentrepreneurs.com/market-briefing-cocoa-17-july-2021/