Ivory Coast will slash the amount of cocoa it sells on international markets from the upcoming crop, according to two regulatory sources, as the world's top producer of chocolate's main ingredient grapples with a second year of output decline.

They said the regulator will cut the contract sales limit to 1.3 million metric tons for the 2025/26 cocoa season from the usual 1.7 million tons after two weaker crops caused by climate change, ageing plantations and the spread of plant diseases.

Three sources at Ivory Coast's Coffee and Cocoa Council (CCC) said two back-to-back production declines suggested it was not just a cyclical fall, but a structural trend.

About 70% to 80% of the country's main crop production is sold in world markets in advance as "contract" sales, which totalled around 1.7 million tons during the 2022/2023 season when Ivory Coast produced 2.3 million tons of cocoa.

But that output fell to around 1.75 million tons the following season and is estimated at a similar level for the 2024/2025 season that ends this month.

An analysis of the past two season's data raised concerns Ivory Coast may not return to its average production level of 1.3 million tons of cocoa during the October-March main crop for several years, they said.

On average, the main crop yields 1.7 million tons of cocoa and the mid crop around half a million.

A CCC official said limiting contract sales to 1.3 million tons was more realistic for the upcoming 2025/26 main crop.

"We don't want to take any risks. That is why we have decided to limit ourselves to 1.3 million tons of export contract sales," one of the CCC sources said.

Cocoa farmers, pod counters and exporters said swollen shoot disease was spreading rapidly through all of Ivory Coast's 13 cocoa-producing regions.

The viral disease, for which there is no treatment, has affected around half of the country's cocoa fields, they estimated.

Over the longer run, rejuvenating plantations with new seeds could help, as aging orchards, more susceptible to disease and climate change, account for 70% of Ivory Coast's total, according to industry sources.

Irregular rainfall and drought have also impacted cocoa production.

The weather between April and June will provide insight into the next main harvest, with two CCC sources saying their pod counting teams were currently reporting conditions similar to 2023 and 2024.

"At the moment, weather conditions are difficult for this season's mid-crop," one pod counter said.