October marks the start of the new crop year, and it can be useful to analyze grinds over a similar period when calculating the current supply and demand balance. The Q4 2021 grinds, from Oct. 1 to Dec. 21, 2021, showed continued strong offtake and demand for cocoa products, which will likely spill over from 2021 into the current year.

In Europe, the largest and most significant reporting region, grind registered an uptick of 6.3 percent with 365,826 MT of beans consumed during the period. This marks the third straight quarter of growth, and nearly 22,000 MT of beans more were vs. compared to Q4 2020.

Asian results were very similar, with 231,309 MT of grind reported, the region’s largest quarterly grind on record. Grind was up 6.3 percent YOY for Q4 and up 5.6 percent in 2021 vs. 2020—well above the global grind growth rate of 3.4 percent in calendar 2021.

North America was the only region with a YOY decline reported for Q4 grind. Overall, beans consumed across the region fell by a modest 1.2 percent, although it is important to point out that one less plant was operating due to industry consolidation. One plant fewer makes a pure apples-to-apples comparison difficult, and it is easy to attribute the anomalous decline to a change in the reporting basis rather than to a true drop in underlying demand. While some 1,429 MT fewer beans were processed vs. Q4 2020 grind, total beans processed during calendar 2021 were up about 19,000 MT or 4.1 percent YOY.

More significantly, considering all reporting regions, the 2021/22 crop year is off to a more than solid start, continuing the recovery that was the story all last year. Supply-chain challenges and rising prices will undoubtedly check demand and cause some measure of deceleration, but the market still anticipates another year of grind expansion in 2022.

World cocoa grind growth

Source: ICCO, trade sources, McKeany-Flavell
Posted by: Information Services
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