BRAZIL: July Cotton Prices Reach Highest Levels Since March 2024
By 2024-08-06 10:53:43
Brazil: July Sees the Highest Levels of Cotton Prices Since March 2024
In July, the monthly average of cotton prices in Brazil reached the highest levels since March 2024, in real terms. This upward trend was mainly driven by limited supply in the spot market and firm pricing by many sellers focused on fulfilling contracts.
However, there were periods during the month when prices dipped due to some sellers being more flexible, aiming to offload batches of the 2022/23 crop or to generate quick cash.
The monthly average of the Index was BRL 4.0793 per pound, marking a 3.76% increase from June 2024 and a 3.1% rise compared to July 2023, in real terms (IGP-DI June 2024). This is the highest level since March 2024, when the price was BRL 4.3019 per pound. From June 28 to July 31, the CEPEA/ESALQ cotton Index (with payment in 8 days) rose by 2.67%, closing at BRL 4.0757 per pound on July 31.
Cepea's calculations show that export parities FAS (Free Alongside Ship) fell by 6.6% from June 28 to July 29, reaching BRL 3.8782 per pound (USD 0.6890 per pound) at the port of Santos (SP) and BRL 3.8887 per pound (USD 0.6908 per pound) at the port of Paranaguá (PR) on July 29. The Cotlook A Index (product delivered in the Far East) also decreased by 7.2% in the same period, down to USD 0.7930 per pound on July 29.
According to data from Abrapa (Brazilian Cotton Producers Association), 28.39% of the 2023/24 cotton area in Brazil had been harvested by July 25, and 9.96% of the production had been processed.
