Cocoa has collapsed ~67% from its December 2024 all-time high as back-to-back surplus years take hold. But managed money has pushed to its most bearish net-short position in three years, the futures curve remains stubbornly backwardated, and NOAA has just confirmed El Niño conditions threatening the 2026/27 main crop. This report defines the specific triggers that would convert a monitor posture into a tactical accumulate.
IU Verdict (June 2026): Early Setup / Monitor — build a watchlist position on pullbacks toward $3,500–$3,800; the decisive signal is October 2026 main-crop pod counts.
Updated July 2026 → Posture Upgrade · full coverage timeline
Cote d'Ivoire and Ghana's combined ~60% of production, the disputed unsold-inventory data, and Ecuador's imperfect offset.
NOAA's Advisory and the historical link between El Niño and West African main-crop damage — the most consequential variable for the next 12 months.
Managed money at a 3-year net-short extreme, the OI + volume framework for reading short-covering vs. new buying, and why backwardation contradicts the surplus narrative.
The EUDR's December 2026 deadline, the collapsed farmgate price floor, and IU's complete add/trim triggers with defined accumulation zones.
