10 Best Cocoa Commodity Forex Brokers

When it comes to Cocoa Commodity Forex Brokers, this commodity Cocoa is a food derived from the dried and fermented seeds (beans) of the Theobroma Cacao plant.  Cocoa is used in both food and non-food applications around the world, the most popular of which is undoubtedly chocolate production.

Choose your quick section of our Cocoa Commodity Forex Brokers below.

10 Best Handpicked Cocoa Commodity Forex Brokers Revealed:

• ✔️eToro
• ✔️FP Markets
• ✔️IC Markets
• XTB
• AvaTrade
• Roboforex
• Pepperstone
• EasyMarkets
• CMC Markets
• Saxo Bank

Investors who are looking to start trading in this whole grain and other agricultural commodities, here is an overview of the 10 Best Globally Regulated Cocoa Commodity Forex Brokers and Trading Platforms to consider.

eToro

eToro is an online broker which was founded in 2006 and offers CFDs and Social Trading, with a head office based in Cyprus, UK.  eToro is supervised by the Financial Conduct Authority (FCA), Cyprus Securities and Exchange Commission (CySEC) regulatory bodies and has been in operation for over 14 years.

Pros and Cons

eToro offers traders two ways to trade: CFDs, Social Trading and eToro traders will need to make a minimum deposit of $200 and the platform can accommodate various levels of traders from beginner to expert.  Traders can trade in a wide variety of over 100 instruments and over 50 currency pairs on eToro’s user-friendly custom trading platform which is available as a browser-based web application. eToro also offers traders mobile apps for Android and iOS, making it easier to keep an eye on and execute trades.

Trading Benefits

eToro supports a wide range of languages including English, German, Spanish, French, and Italian.  24/6 customer support is available via telephone and support ticket.

FP Markets

FP Markets is a global, online broker regulated by the Australian ASIC and the Cypriot CySEC which was founded in 2005 and offer Forex trading and has a head office situated in Australia. When starting off with FP Markets traders will need to make a minimum deposit of $100 and a demo account is on offer with a wide variety of instruments and currency pairs on offer. Over 100 instruments and over 60 currency pairs in total are on offer, on the popular MT4 forex trading platform.  FP Markets also offers traders mobile apps for Android and iOS.

Pros and Cons

Trading Benefits

All accounts support a wide range of languages including English, Spanish, Portuguese, Romanian, Bulgarian, Arabic, Russian, French, Italian, Greek, Philippines, Latvian, Polish, Indonesian, Thai, Malay, German, Vietnamese. Customer Service is available via email, phone and live chat.

IC Markets

IC Markets is a regulated Forex ECN and CFD broker which offers more than 236+ financial instruments across Forex, Commodities, Indices, Bonds, Cryptocurrency, Stocks and Futures on the MetaTrader 4, MetaTrader 5 and cTrader platforms for desktop, web and mobile.  IC Markets is regulated by the Australian Securities and Investments Commission (ASIC), the Cyprus Securities and Exchange Commission (CySEC), as well as the Seychelles Financial Services Authority (FSA).

Pros and Cons

IC Markets offers traders three main types of live trading accounts to choose from, including  Raw Islamic swap-free accounts and the use of a free demo trading account.

Trading Benefits

Customer support is available 24/7 via Live Chat, Phone and Email.

XTB

XTB is a European broker which was founded in 2002, and has offices in 13 countries across the globe.  XTB is regulated by the UK Financial Conduct Authority (FRN 522157) and has been listed on the Warsaw Stock Exchange since 2016. XTB is a fintech company which combines financial services with innovative technology and it offers clients two platforms to choose from:

xStation5

MT4

Pros and Cons

Traders can choose from 25 crypto CFDs (9 individual coins or 16 crypto pairs) which are available 7 days a week (from 3am Saturday to 9pm Friday). Traders can buy or sell digital coins with 2:1 leverage and 365-day expiry.

Trading Benefits

XTB support a wide range of languages including English, Spanish, Czech, Chinese, German, French, Italian, Polish, Portuguese, Romanian, Slovenian, Turkish, Arabic, and Russian.

AvaTrade

AvaTrade is an online broker which was founded in 2006 and offers Forex, CFDs, Spread Betting and Social Trading and is a global broker with their head office situated in The British Virgin Islands. AvaTrade is regulated in Europe, the British Virgin Islands, Australia, Japan, and South Africa by ASIC, CySEC and FCA.

Pros and Cons

For those who are looking to start out with AvaTrade will need a minimum deposit of $250 and a demo account is available for those who want to get acquaint with the popular MT4 forex trading platform.  AvaTrade also offer mobile apps for Android and iOS.

Trading Benefits

Customer support is available by email, phone, or live chat.

Roboforex

Roboforex are an online, global broker which was founded in 2009 and offers traders Forex and CFDs trading.  Roboforex is authorized and regulated by the International Financial Services Commission (IFSC) with license number IFSC/60/271/TS.

Pros and Cons

When starting off with Roboforex traders will need to make a minimum deposit of $1 and there is an option available for a demo account for those who would like to get acquainted with the platform.  Roboforex can accommodate various levels of traders, from experienced to beginner, and they can trade a wide variety of instruments and currency pairs.  Roboforex offers over 100 instruments and over 35 currency pairs in total.   Roboforex offers traders both of the MetaTrader platforms; MT4 and MT5 plus the cTrader platform developed for traders.   Roboforex also offer mobile apps for Android and iOS.

Trading Benefits

Customer support is available via phone, Webchat, WeChat, Skype, Viber, Telegram, Facebook chat, WhatsApp, email and a call-back request.

Pepperstone

Pepperstone was founded in 2010 and is regulated by the Australian Securities and Investments Commission (ASIC), as well as the UK’s Financial Conduct Authority (FCA).

Pros and Cons

Trading platforms on offer include MetaTrader 4,  MetaTrader 5 and cTrader. All three FX trading platforms come with a free demo account which will allow traders to test out the forex broker and platform for 30 days.

Trading Benefits

Pepperstone offers 24/5 multiple language support via email, phone and live chat.

EasyMarkets

EasyMarkets is one of the most popular choices for Beginners and is regulated by CySEC (Cyprus) and ASIC (Australia) and offers beginner forex traders:

Enhanced risk management tools as standard

Fixed spreads on all forex pairings

An easy-to-use forex trading platform

Pros and Cons

 The available trading platforms offered are MT4 and the EasyMarkets web platform.

Trading Benefits

Customer Support is available 24/5 via  various chat channels, email, phone and web forms.

CMC Markets

CMC Markets is a multi-asset class spread betting and CFD broker which is regulated by the UK’s Financial Conduct Authority (FCA). Clients have the ability to trade on more than 9,000+ trading instruments covering Indices, Forex, Cryptocurrencies, Commodities, Shares and Treasuries, all on the MetaTrader 4 platform or the broker’s own proprietary, web-based Next Generation platform.

Pros and Cons

CMC Markets offers a wide range of instruments to trade on covering all major asset classes such as 300+ Forex instruments, 60+ Indices, 15 Cryptocurrencies, 90+ Commodities, 30+ Treasuries and 9,000+ Shares and ETFs.

Trading Benefits

Customer support is available 24/5 via Live Chat, Telephone, and Email.

Saxo Bank

Saxo is a globally regulated, multi-asset class broker which offers clients the option to trade on more than 40,000 instruments covering Forex, CFDs, Stocks, Options, ETFs, Commodities, Futures, Bonds and Mutual Funds from a single account across multiple platforms including their own – SaxoTraderGO and professional-grade SaxoTraderPRO.

Pros and Cons

The Saxo Group is regulated in 15 jurisdictions including authorisation from the UK Financial Conduct Authority (FCA), the Australian Securities and Investments Commission (ASIC), the Financial Services Agency of Japan (FSA) and many more.

Trading Benefits

Customer support is available in nearly 30 different languages via phone, email and an FAQ section.

Main uses of Cocoa

Cocoa Liquor

Cocoa Liquor is the main ingredient in the ever-popular chocolate and other confectionary products.

Cocoa Powder

Cocoa Powder is used as an ingredient in chocolate flavoured drinks and desserts.

Cocoa Butter

Cocoa butter is used to manufacture chocolate and cosmetic products such as soap.

Cocoa Husks

The husks of cacao pods and the pulp which surrounds the beans have a variety of commercial uses including Animal feed, Soap manufacturing, Fertilizer, Pectin production for jams and marmalades and Mulch.

The top cocoa producing countries include Indonesia, Ghana and the Ivory Coast whereas the top importers are predominantly North American and Western European countries.

Where Can Cocoa be Traded?

Cocoa can be traded through a variety of financial instruments and Commodity Brokers who offer access to the market.

Ways to Trade Cocoa

Cocoa investors have several ways to invest in the commodity:

Cocoa Commodity Futures

The New York Mercantile Exchange or NYMEX, which is part of the Chicago Mercantile Exchange (CME), and the Intercontinental Exchange (ICE) offer investors futures contracts on cocoa which settles into 10 metric tons of the commodity. The CME contract trades globally on the CME Globex electronic trading platform with expiration months set in March, May, July, September and December respectively.  Futures Contracts are derivative instruments through which investors make leveraged bets on commodity prices in the futures markets.

If the price declines, customers will be required to deposit additional margin in order to maintain their positions. At the point of the contract’s expiration, it will be financially settled on the NYMEX, but physically settled on the ICE. Both the CME and ICE offer an options contract on cocoa futures, however there are some differences applicable. The CME contracts are options on the physically delivered cocoa futures contract that trades on the CME Europe exchange whereas the ICE contracts are options on its physically delivered cocoa futures contract.

Cocoa ETFs

Cocoa EFTs  trade similarly to shares on exchanges in the same way that stocks do. To date there are two ETFs that invest in cocoa futures, namely the iPath Dow Jones-UBS Cocoa ETN iPath Bloomberg Cocoa Subindex ETN

Cocoa Company Shares

To date there are no pure-play global public companies which purely engage in the production and sale of cocoa. However, some chocolate manufacturers such as Hershey Co. (NYSE: HSY) will invest in cocoa futures in order to offset their risk from higher cocoa prices.

Cocoa CFDs

A popular way to trade in cocoa is through the use of a contract-for-difference (CFD) derivative instrument.  Cocoa CFDs will allow customers to speculate on the price of cocoa. The value of a CFD refers to the difference between the price of the shares at the time of purchase and the current price.

Factors that drive the price of Cocoa

The price of cocoa is generally driven by six factors main factors which include, Supply and demand, Climate, Production Cycle, Infrastructure and Transportation, Consumer Preferences and the British Pound. Here is a short overview of each individual factor.

The Global Cocoa Supply

The supply of cocoa is heavily concentrated on geolocation data.  Market research shows that over 60% of global production will come from a selection of countries in Western Africa with the Ivory Coast being the largest producer in the world. The price change of Cocoa prices sees wide swings as a result of news from this region. Political and civil unrest and labour disputes can have a major effect on the value and volume of this commodity.

Climate Impact On Cocoa Plants

Cacao pods will require a mix of wet weather and sunshine in order to successfully ripen. Each stage of the five-year cocoa production process, from planting to fruit production, will require ideal weather conditions. Periods of long droughts or heavy rains can cause the cocoa pods to dry out or rot. Weather conditions will determine the yield of crops, and it can have a major impact on cocoa prices.

The Complex Production Cycle of Cocoa

The production cycle of cocoa, from planting to harvesting is a multi-year endeavour which means that Cocoa Farmers will have to make a range of decisions in regards to crop production long before they will even see any level of profit from their investment. Multiple factors including the future outlook for cocoa prices can impact the quantity of production.

Ease Of Cocoa Transportation

Cocoa is grown in mostly disadvantaged parts of the world with limited infrastructure. Poor roads and transportation equipment make the regions of supply vulnerable to supply disruptions. Factors such as Excessive rain for instance, can lead to significant delays in transporting cocoa to consumers. These delays will in turn result in supply shortages and higher prices.

Consumer Preferences For Cocoa Products

The Changes in consumer taste can affect the demand for cocoa and impact prices thereof. For example, in many western countries, dark chocolate consumption has seen a substantial rise due to positive feedback about its health benefits. Dark chocolate production will require more cocoa to produce than milk chocolate which will result in a higher demand. Emerging market consumers may also drive cocoa prices.

British Pound Inflation & Deflation

Cocoa is one of the last remaining commodities which is traded in British pounds. When the pound weakens, the price of cocoa will become more expensive on the London futures market. However, US futures for cocoa trade in dollars, so their price will be affected by the US currency.

In Conclusion

Cocoa Production is subject to a large number of uncontrollable factors such as weather conditions.  Experts are on the fence about the futures of Cocoa, as some see a bright future whereas others are approaching this commodity with the utmost caution.  Investors should ensure that they are aware of all factors in play before investing any money in the market.

FAQs

What influences the price of cocoa?

Factors which may influence the price of cocoa includes weather patterns and the level of demand.

How do I begin trading cocoa?

The first step is for a trader to decide if they will trade the actual cocoa futures contracts or use a derivate such as a CFD. Cocoa futures will require the use of a designated futures account, whereas CFD trading is far simpler, with a much smaller initial deposit required.

What is the best cocoa trading strategy?

There are a number of strategies which can be used to trade cocoa and the best trading strategy will the one that best suits the individual investor.