On April 6, 2005, the government of the Ivory Coast agreed with leaders of rebel forces to end all hostilities, but implementing that agreement has proved difficult. When it comes down to it, neither side is willing to disarm and the national elections that were scheduled for late October were postponed and may not occur. This producer of 40% of the world's cocoa is not a stable place. Also, on September 19, 2005, Dow Jones Newswires said that fertilizer sales in the Ivory Coast were down 60% from a year ago. Low cocoa prices and instable politics may eventually hurt production and lead to higher prices, but there is no sign of that happening yet.

On August 25, 2005, the International Cocoa Organization estimated the 2004-2005 world net cocoa crop at 3.16 million tons and total use at 3.27 million tons, resulting in a 106,000 ton production deficit. While this represents a slight improvement in the cocoa surplus, the ending stocks are still on the heavy side even with all the political problems in the Ivory Coast. In the third quarter of 2005, U.S. cocoa grindings totalled 104,470 tons, up .4% from a year ago. In the fourth quarter of 2005, Europe's cocoa grindings totalled 301,742 tons, up 4.7% from a year ago.

With the (Ivory Coast's) governments in at least a temporary settlement, and with good weather for cocoa growing, the crop can be expected to be around 1.3 million metric tons, slightly less than in 2005.

Vincent t'Sas, Dow Jones Newswires. December 13, 2005.

The new crop is supposed to be bigger than last year's crop and (harvest) is supposed to start soon in September," said Ann Prendergast, cocoa analyst at Refco.

"There's no shortage of cocoa, so there's not a lot of incentive to go up," she added.

Dow Jones Newswires. August 9, 2005.