Cocoa, sugar, milk and durum wheat: in 2027, production deficits and price rebounds

A 2027 of high volatility for agro-industrial commodity prices. The weather and production deficit, as well as geopolitical variables, will continue to weigh.

Since last January, international cocoa prices have soared by 78%, sugar prices by 40% from their annual lows, and spot milk prices have doubled compared with 6 months ago. In addition, durum wheat prices have been stable for at least a year, but this year’s Canadian production deficit risks triggering a price surge.
According to research company Areté, cereals are showing tighter fundamentals, supported not only by declining production in the main exporting areas, but also by the slowdown in trade and port blockages in the Black Sea area.

Interconnected supply chains

The list of highly volatile agricultural commodities includes sugar, rice, milk and cocoa, which in 2026 painstakingly began rebuilding stocks and experienced a downward correction in prices. Next year, however, their respective production will probably suffer production deficits, interrupting the difficult process of normalisation.
“The markets,” said Areté president Mauro Bruni during Commodity Agrifood, a meeting organised with Unionfood , “did not have time to rebuild adequate stock levels before being subjected to new pressures, generated by the combination of meteorological, logistical and geopolitical factors. From difficulties in transiting the Strait of Hormuz to drought, global markets have once again entered a phase of high volatility and uncertainty. This scenario highlights the fragility of agri-food commodities and the profound interconnection of international supply chains.”

Sugar & coffee

In detail, next year the global sugar market is expected to face a production deficit following a decline in supply in Brazil due to increased incentives for ethanol production. Sugar production in the EU is also expected to be in decline by more than 3 million tonnes, as a result of reduced acreage and drought-affected yields.
Tensions over coffee prices do not appear likely to be resolved. This year, international prices have fallen by 20%, but levels are more than double those seen before the pandemic. The market is still being affected by four production seasons of decline, which have driven global stocks down to their lowest levels since the end of the 90 s. Estimates indicate a slight production surplus in 2026/27 of around 3% and a recovery in stocks of 5%. Analysts expect greater scope for a price correction for Arabica than for Robusta.

Lower cocoa production

Finally, in the cocoa market, the recovery in production in Côte d’Ivoire and Ghana and a contraction in consumption for two consecutive seasons have favoured the rebuilding of stocks and a correction of 70% in bean prices from the peaks at the beginning of 2025.
However, a new production deficit is expected in the two main producing countries, which could lead to a contraction in stocks that Areté estimates at over 7%.

Other articles:

Durum wheat: a production surplus for the global market in 2026

Podcast: Gentile (Areté), little room for consumer prices to fall

This article was translated from the original Italian version with the assistance of artificial intelligence. In case of discrepancies, please refer to the original Italian version.