So far we have seen some volatile trading in cocoa. We saw a slight move higher than a sell-off earlier this week – now some consolidation should be seen in the March contract next week. Global demand is strengthening, providing support for the further out contracts. With the help of Asia, it is projected that the global supply and demand should be closer in balance this calendar year. The market hasn’t taken off yet due to the news that exports out of Ivory Coast are ahead of last year’s pace – although some analysts don’t believe this is an accurate reading. Ivory coast saw late arrivals last year that affected the export data which skews the information. ICE reported cocoa stocks dropped for the seventh month. A drop in stocks like this, about 40% since May, could be bullish and help the North American demand outlook. The currencies have provided support to cocoa futures – euro and the pound specifically. A technical move higher, above 1960 is needed to reaffirm the news we are given for the anticipated outlook in 2018.

Cocoa Mar ’18 Daily Chart


Peter Mooses

Follow Peter on Twitter @PMoosesRJO. Peter's interest in trading began during a college internship with Bunge North America on the floor of the Chicago Board of Trade, where he assisted commodities traders and performed market research and analysis. Upon earning a B.A. in economics from the University of Iowa, Peter served as an analyst, transaction manager and team lead in the Global Trust Divisions for LaSalle Bank and Bank of America, where he managed transaction activity in multi-million dollar client fixed income and asset-backed securities portfolios. After years in the banking industry, it became apparent that Peter's real passion lies in futures trading. He joined RJO Futures because he enjoys the analytical aspects of futures trading and appreciates the economic impact that commodities have across all markets. Peter believes in utilizing market analysis and trends to help clients achieve balance between risk and return, while always keeping their investment objectives top of mind.