El Niño 2026–27: The Weather Risk Hanging Over Cocoa, Coffee and Sugar

Côte d’Ivoire and Ghana are two critical sources of global cocoa, making weather in West Africa especially important for the world market. Historical data cited by Reuters indicate that every strong El Niño over the past 55 years was accompanied by a decline in cocoa production. That is a warning signal, not proof that every event will produce an identical fall in output.

Ghana cuts its production outlook

Ghana’s cocoa regulator expects 2026–27 production to reach only 450,000–550,000 tonnes, compared with 750,000 tonnes projected for 2025–26. El Niño is one of several factors cited, alongside swollen-shoot disease and ageing cocoa farms.

Côte d’Ivoire slows new commitments

Côte d’Ivoire had sold roughly 1 million tonnes of cocoa under export contracts for the 2026–27 main crop, but began slowing further sales because of concerns that El Niño could affect production. The move shows that suppliers and market participants are responding to the potential supply risk, even though the final crop will depend on actual rainfall and growing conditions.

The global surplus could shrink

StoneX, as reported by Ecofin, expects the global cocoa surplus in 2026–27 could fall to about 25,000 tonnes from a projected 422,000 tonnes in the current season. Another analysis puts the expected surplus closer to 98,000 tonnes, highlighting the wide range of current estimates.

The common conclusion is that adverse weather in West Africa could make the cocoa market much less oversupplied and increase upward pressure on prices. Still, cocoa prices also depend on grindings, inventories, export financing and other market forces. El Niño alone cannot explain every price move.

Coffee: different risks for Brazil, Vietnam and Indonesia

Coffee can be affected in several ways. Unusual rainfall has been linked to delayed harvesting in Brazil, while El Niño-related heat and dryness raise risks to yields and bean quality in Brazil, Vietnam and Indonesia. Analysts have paid particular attention to robusta, with Vietnam’s coffee-growing regions potentially facing prolonged dryness if the event strengthens.

The available data does not establish the size of the potential loss in any individual country, nor does it support a reliable numerical forecast for coffee prices. The most cautious conclusion is that El Niño is increasing the weather-risk premium in the market—not that production or prices will certainly rise by a specific amount.

Sugar: Asia could suffer while Brazil offers a partial offset

Drier conditions in India and Thailand could reduce sugar-cane yields and support global sugar prices. More rainfall in Brazil could help cane development during some stages, but excessive rain may also disrupt harvesting and milling.

That contrast makes El Niño’s effect on sugar harder to predict than its potential effect on cocoa. Brazil could partly offset losses in Asia, but the outcome will depend on the timing of rainfall, harvesting progress, processing capacity and whether mills direct cane toward sugar or ethanol. The available sources do not provide enough evidence for a firm estimate of production losses in India, Thailand or Brazil.

The risk extends beyond one poor harvest

The effects can spread through the entire supply chain:

• Production: Drought, heat or excessive rain can reduce yields, damage quality and shift harvest timing.
• Processing and transport: A delayed or concentrated harvest can put pressure on factories, ports and delivery schedules.
• Food prices: Tighter supplies can raise costs for coffee roasters, chocolate makers, beverage companies and food manufacturers.
• Food security: Import-dependent countries are more exposed when commodity prices and logistics costs rise together.

The main danger is not necessarily that every producing region fails at the same time. It is that several local shocks occur close together in concentrated supply regions, while farmers and businesses have limited financial room to respond.

What could limit the damage?

Turn forecasts into early action

Seasonal forecasts are useful only when they trigger support before losses occur. Possible measures include pre-positioning seed, fertilizer and fuel; expanding access to credit; supporting irrigation; monitoring pests; providing crop insurance; and preparing targeted food assistance.

Build resilience on farms

Drought- and heat-tolerant varieties, shade management, improved soil moisture, irrigation where feasible, and crop diversification can reduce dependence on a single weather pattern. For cocoa and coffee, replacing an established perennial orchard takes far longer than restoring a seasonal food crop, making early investment especially important.

Preserve system buffers

Grain inventories and diversified import sources can cushion staple-food markets. Major exporters such as Brazil, as well as Russia in wheat markets, may help stabilize global availability if their own harvests, logistics and trade policies remain reliable. These buffers are less effective for perennial crops such as cocoa and coffee, where new trees take years to reach productive maturity.

Bottom line: a strong warning, not a price prophecy

The latest data show that El Niño 2026–27 is a serious weather risk. NOAA puts the probability of a very strong event above 90%, while some media reports suggest it could rank among the strongest ever observed.

Cocoa—especially in Ghana and Côte d’Ivoire—has the clearest evidence of tightening supply risk. Coffee and sugar are also exposed, but the effects will differ across countries and cannot yet be translated into precise production or price forecasts.

The decisive variable will be actual rainfall in each growing region, not simply Pacific sea-surface temperatures. El Niño changes the odds of certain weather patterns; it does not automatically determine a harvest, a price or a climate record.