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El Niño Brings Drought to Indonesian Cocoa and Heavy Rain to Ecuador

By: Editorial Team, StoneX Media

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The El Niño cocoa impact is landing unevenly across producing regions, with Indonesia suffering the sharpest productivity losses, Ecuador taking heavier rain and Brazil seeing less of it. In West Africa, the main producing region, irregular rain in June and July is already affecting the main crop in Ivory Coast and Ghana. A strengthening El Niño toward the end of the year also raises the risk of harsher Harmattan winds over the following mid-crop. The cocoa market remains highly sensitive to the weather pattern after the 2023 El Niño set off years of disruption, so every regional shift feeds straight into supply expectations.

Lucca Bezzon, Market Intelligence Analyst at StoneX Brazil, covers global soft commodity markets from Campinas, tracking supply and demand balances in cocoa and coffee. His work follows production flows across West Africa, emerging producers and Brazil's harvests, along with the industrial demand shifts that move cocoa prices.

Key Themes from the Discussion

  • Indonesia records the largest El Niño cocoa productivity losses, with sharp drops in rainfall and soil moisture.
  • Ecuador sees heavier rain in El Niño years, and Brazil sees lower precipitation.
  • Irregular June and July rain is already affecting the West African cocoa main crop.

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Indonesian Cocoa Output Takes the Heaviest El Niño Losses

The El Niño risk to global cocoa supply is not confined to West Africa. Indonesia is taking the heaviest El Niño cocoa losses of any producing country. Indonesian growing areas have seen a steep fall in both rainfall and soil moisture.

Ecuador and Brazil Cocoa Farms Swing to Opposite Rain Extremes

"Ecuador is quite the opposite. Ecuador usually has bigger rains in Niño years", Bezzon explains, pointing to the other side of the El Niño weather pattern. Ecuador has already recorded an increase in rainfall. Too much rain can also reduce cocoa productivity, although the effect is too early to measure. Brazil's cocoa regions are moving the other way, with precipitation diminishing. In practice, El Niño is hitting Indonesian, Ecuadorian and Brazilian cocoa through different mechanisms at the same time. For the supply picture, that means no single weather signal tells the whole story.

West African Cocoa Main Crop Shows Early Rain Distortion

West Africa's cocoa main crop in Ivory Coast and Ghana is already showing the effects of irregular rainfall, although the damage so far is smaller than in Indonesia. Heavier than expected rain in June arrived while the beans were still developing. According to Bezzon, "in June, in July, we've seen some type of distortion related to precipitation, which is already having impacts on the main crop right now". The seasonal delivery peak between October and December will therefore show how far the weather has cut into West African volumes. A weaker main crop would tighten a market that only recently rebuilt its stocks.

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--- Written by Frédéric Guétin, StoneX Media Producer

--- Expert: Lucca Bezzon, StoneX Brazil, Market Intelligence Analyst

  • Cocoa

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