Where does cocoa come from?

The cacao tree (Theobroma cacao) is native to the upper Amazon basin, but the crop that fills the world's chocolate is grown mostly on the other side of the Atlantic. Cacao is an understory tree of the humid tropics: it wants temperatures that never drop far below 20°C, rainfall spread through most of the year, deep soils and, when young, shade. That confines commercial growing to a narrow band roughly 20 degrees either side of the equator, and within that band to the wettest lowlands.

In 2024 Ivory Coast (Côte d'Ivoire) produced 1.9 million tonnes of cocoa beans, 36% of the world's 5.2 million tonnes (FAOSTAT). Indonesia was second with 12%, and the two neighbors together dominate the market in a way no pair of countries does for coffee or wheat. Ghana (10%) and Ecuador (7.7%) follow; the top five produced 73% of the total, and the share outside the top ten was only 9.2%.

West African cocoa is a smallholder crop. Typical farms are a few hectares of Forastero-type trees, often the Amelonado variety that Tetteh Quarshie carried to the Gold Coast in 1879, planted as the forest frontier moved west from Ghana into Ivory Coast after independence. Yields are low, trees are aging and new land is scarce, which is why output has stalled even as prices rose. Cameroon and Nigeria complete the West African bloc. In Latin America, Ecuador grows both fine-flavor Nacional cocoa and the high-yielding CCN-51 clone on larger, more commercial farms, and Brazil's Bahia plantations have partly recovered from the witches' broom fungus that devastated them. Indonesia's Sulawesi smallholders made it a major producer, although its crop has shrunk as farmers switched to palm oil and other crops.

The map is therefore the product of botany plus history: a New World tree, carried by colonial trade to islands off Africa and then to the mainland, where a forest belt and millions of family farms turned it into the world's supply.

Cocoa is exported in four forms: raw beans (HS 1801), cocoa paste or liquor (HS 1803), cocoa butter (HS 1804) and cocoa powder (HS 1805). Beans are the form that says where cocoa comes from. In 2024 Ivory Coast (Côte d'Ivoire) was the biggest exporter of cocoa beans with 26% of world export value (CEPII BACI), followed by Ecuador and Nigeria. The largest importer of beans was Netherlands (22% of world import value), ahead of Malaysia and Germany.

The semi-finished products tell a different story. The top exporter of cocoa butter in 2024 was Netherlands (27% of world export value), and the top exporter of cocoa powder was Netherlands; the leading exporter of cocoa paste was Ivory Coast (Côte d'Ivoire). The Netherlands, Germany and Malaysia grind imported beans and re-export butter and powder they did not grow, while Ivory Coast and Ghana have built grinding capacity at home so that a growing share leaves as paste and butter rather than beans. Chocolate itself trades under HS 1806 and is not counted here.

Cocoa has two benchmark futures contracts. ICE Futures US lists the Cocoa contract (ticker CC), 10 tonnes per lot, quoted in US dollars per tonne; ICE Futures Europe lists London Cocoa (ticker C), also 10 tonnes, quoted in pounds sterling per tonne. Both deliver beans of approved origins into licensed warehouses in Europe and the United States. The World Bank series on this page, Cocoa (ICE New York and London average), averages the two markets: it was $5.95/kg in August 2026, down 22% from a year earlier (World Bank Pink Sheet). The series' highest month on record was $10.75/kg in January 2025 and its lowest $0.26/kg in July 1965; over ten years it has moved +96%. The International Cocoa Organization publishes a daily price that averages the nearest three active months on both exchanges.

Physical beans trade at a differential to the futures. Ghana beans earn a premium for consistent fermentation and low defects; Ivorian beans trade near the reference; Ecuadorian, Nigerian and Cameroonian beans are quoted at their own discounts or premiums; and certified fine-flavor cocoa from Ecuador, Peru or Madagascar can sell far above the exchange price. Grades are set by cut test (share of moldy, slaty and insect-damaged beans) and by bean count per 100 grams. Ivory Coast and Ghana add a further layer: their marketing boards sell most of the crop forward before the season opens, fix a farmgate price for the year and, since 2019, charge buyers a living income differential on top of the market price.

Two ambiguities. Cocoa on this page means fermented, dried beans; cocoa products are priced separately, often as ratios of the bean price (the butter ratio and powder ratio). And the London contract is in pounds, so the dollar-sterling rate moves the London price even when nothing has changed in the physical market.

Ivory Coast and Ghana grow well over half of the world's cocoa, so their rainfall is the market's main variable. The main crop, harvested from October, depends on rains from April to July; the smaller mid-crop depends on the dry Harmattan wind from the Sahara being short and mild between December and February. Too little rain shrinks pods, too much spreads black pod fungus, and El Niño years have brought both heat and drought to the region.

Cocoa swollen shoot virus, spread by mealybugs, kills trees within a few years and has no cure; the only remedy is cutting out infected farms, which removes production for the years it takes to replant and bear. Black pod (Phytophthora) rots pods in wet weather. Both diseases spread faster on aging, unshaded farms, and neither can be fixed within a single season, so an outbreak shows up in supply for years.

Ivory Coast's Conseil du Café-Cacao and the Ghana Cocoa Board sell most of the crop forward and fix farmgate prices for the season. When the fixed price lags the world market, farmers sell less fertilizer-intensive care into their trees and beans are smuggled across whichever border pays more; when the two countries' prices diverge, beans flow toward the higher one. Board decisions on farmgate prices, forward sales and the living income differential can move the futures market as much as weather does.

A cocoa tree yields best between roughly its tenth and twenty-fifth year, and much of West Africa's stock is past that. Replanting costs money and several years of lost income, and the forest that used to absorb new planting is either gone or protected, with EU deforestation rules closing the door on beans from cleared land. Supply therefore cannot respond quickly to high prices the way an annual crop such as corn can.

Quarterly grind statistics from the European, North American and Asian cocoa associations are the market's demand proxy: grindings fall when prices are high because chocolate makers cut cocoa content, shrink bars and lean on cocoa butter equivalents, which EU rules allow up to 5% of a chocolate product. Grindings rise when prices fall. Consumer demand itself is steady in Europe and North America and growing in Asia.

Certified stocks in ICE warehouses are the deliverable supply against the futures contract. When they drain, nearby months move to a premium over later ones and the price can gap higher on modest buying. Cocoa is a small market by value, so hedge funds and trading houses can dominate open interest, and forced buying by short hedgers who cannot find beans has amplified rallies.

New York cocoa is quoted in dollars and London in pounds, so the exchange rate shifts the spread between them. The West African CFA franc is pegged to the euro, which means Ivorian and Cameroonian earnings in local currency move with the euro-dollar rate; Ghana's cedi floats and its depreciation has at times made Ghanaian farmgate prices lag Ivorian ones, encouraging beans to cross the border.

Cacao is a small tree that bears pods directly on its trunk and older branches. Seedlings take several years to produce, and hybrid clones bear sooner than traditional Amelonado trees. In West Africa the main crop is harvested from about October to March and a smaller mid-crop from about April to September; Ecuador and Indonesia harvest most of the year. Ripe pods are cut down with knives on poles, split open, and the wet beans scooped out with their sweet white pulp.

Fermentation is the step that creates chocolate flavor. Beans are heaped under banana leaves or placed in wooden boxes for about five to seven days, during which yeasts and bacteria consume the pulp, the bean dies and the precursors of chocolate aroma form. The beans are then sun-dried for about a week on mats, tables or concrete to a moisture level safe for storage, bagged and sold through buyers or cooperatives to exporters. Quality is judged by the cut test, which counts moldy, slaty (unfermented), germinated and insect-damaged beans, and by bean size.

Grinders turn beans into products. Beans are cleaned, roasted and winnowed to separate the shell from the nib; nibs are milled into cocoa liquor (also called mass or paste); liquor is pressed to yield cocoa butter and press cake; cake is milled into cocoa powder, often after alkalization (Dutch processing) to darken color and soften flavor. Chocolate makers combine liquor, butter, sugar and milk powder. By-products include pod husks (compost or potash), pulp (fermented juice and sweeteners) and shells (mulch, fuel and animal feed). Yields per hectare vary widely: intensively managed clonal plantations in Ecuador produce several times what an aging West African smallholding does.

Almost all cocoa becomes chocolate or chocolate-flavored food. Cocoa liquor and cocoa butter are the basis of chocolate bars, coatings and fillings; cocoa powder flavors biscuits, cakes, ice cream, desserts and drinks. Because chocolate makers value butter and powder differently, the two are priced as ratios of the bean price and one can be in surplus while the other is short.

Outside food, cocoa butter goes into cosmetics, soaps and pharmaceutical bases, and cocoa shell and pod husk are used as mulch, fuel and feed. Consumption is concentrated in Europe and North America, with the fastest growth in Asia, according to the International Cocoa Organization's grinding and consumption statistics; the ICO and ICCO both count consumption in bean equivalent rather than in finished chocolate.

Beans move from farm to village buyer or cooperative, then by truck to exporters' warehouses at the ports: Abidjan and San Pedro in Ivory Coast, Tema and Takoradi in Ghana, Douala in Cameroon, Lagos in Nigeria, Guayaquil in Ecuador and Makassar in Indonesia. From there they ship in bulk holds, bagged in containers or loose in container liners to Amsterdam, the world's largest cocoa port, and to Antwerp, Hamburg, Barcelona, Philadelphia and the Malaysian grinding hubs at Port Klang and Pasir Gudang.

Grinding is where the chain narrows. A few processors (Barry Callebaut, Cargill, ofi and a handful of others) operate the large plants in the Netherlands, Germany, Belgium, the United States, Malaysia, Indonesia and, increasingly, Abidjan and Tema. Traders such as Ecom, Sucden and Touton connect them to origin. Chocolate manufacturing is spread more widely, with Mondelez, Mars, Nestlé, Hershey, Ferrero and Lindt buying industrial chocolate and cocoa products rather than beans.

The single points of failure are unusually clear. Two neighboring countries grow the bulk of supply, so one regional drought, one disease outbreak or one political crisis reaches the whole market, as the 2011 export ban in Ivory Coast showed. Two ports in Ivory Coast handle most of that country's exports. Price discovery runs through two contracts on one exchange group, and physical delivery through a small set of licensed warehouses. And because trees take years to replace, there is no spare capacity anywhere to fill a gap quickly.