Cotton prices continue to drop in Brazil (Brazil)

Center for Advanced Studies on Applied Economics (CEPEA) reported that cotton prices registered slight daily drops in the Brazilian market in April. Purchasers have pressed cotton quotes. Part of producers, in turn, was more flexible regarding the low quality product.

In general terms, many cotton growers were refrained in late April, expecting prices to increase. Producers who still have soybean to trade prefer to sell soybean, which hit historical price records in Brazil. As for high quality cotton, the low supply continued to underpin prices in late April.

The CEPEA/ESALQ Index for cotton type 41-4 (delivered in São Paulo city, payment in 8 days) moved down 1.66% in the accumulated of the month (March 30 – April 30), and closed at 1.5967 real or 0.8377 dollar per pound on April 30.

Concerning the 2012/13 season, preliminary data from the USDA indicate that, among major producing countries, only Pakistan will have an increase in the planted area - 3.1%. In other countries, the planted area might shrink.

Center for Advanced Studies on Applied Economics (CEPEA) is a research center of the University of São Paulo located at ESALQ in Piracicaba, State of São Paulo.