The aggregate number of outstanding contracts, known as the open interest, in the New York and London cocoa futures market has fallen by ~35% over the last three months.

The higher margins and volatility in the cocoa have led to open interest declining significantly.¹⁾

• (2023) grew over the last decade as more participants entered the market
• open interest is the amount of contracts held

Low Open Interest Tends to Occur at major lows and very high open interest tends to occur and major tops. This would suggest that an important low may be forming.

Aggregate open interest for London was at nearly 600,000 contracts, or 15 million tons, as of last week’s close. That compares with about 300 contracts, or 7,500 tons, of open interest on the CME. However, the market traded more than 9,000 contracts on the CME during the week that ended April 8, the most since August.

What does it mean when open interest is higher than volume?

The volume value is reset to zero at the start of every other day. But the open interest always remains higher than the volume. Therefore, when the volume is higher than open interests, it indicates a very high level of trading that day.¹⁾

Is it good when there is more open interest than volume?

When the volume exceeds the existing open interest on a given day, it suggests that trading in that option was exceptionally high that day. Open interest also gives you key information regarding the liquidity of an option. If there is no open interest in an option, there is no secondary market for that option.²⁾

Lower open interest in markets aids bigger price swings²⁾

Rainfall is boosting the outlook for crops, and low open interest in cocoa markets is amplifying price moves.³⁾

CME Group Open Interest

cmegroup.com/options-open-interest-profile

CFTC Commitments of Traders (COT) Reports
CME Group CRUDE OIL FUTURES - VOLUME & OPEN INTEREST