As the month progressed, domestic cotton prices saw a brief uptick, driven by rising international prices. Data indicating strong short-term demand and positive mid-term outlooks, particularly due to increasing incomes in emerging Asian markets, contributed to slight price increases for cotton delivered to the Far East. This upward movement influenced the futures market and export parity. However, these factors were insufficient to sustain the upward trend, leading to a subsequent price drop.
Between April 30 and May 15, the CEPEA/ESALQ Cotton Index fell by 2.99 per cent, closing at BRL 3.8063 (~$0.74) per pound on May 15.
According to a report released by National Supply Company (CONAB) on May 14, the cotton cultivation area in Brazil for the 2023-24 season is projected to reach 1.942 million hectares, a 16.7 per cent increase compared to the 2022-23 season and a 0.33 per cent rise from March 2024 data. Productivity is expected to increase by 0.88 per cent compared to the previous month’s estimate but may still be 1.6 per cent lower than the previous crop, at 1.87 kg per hectare. Consequently, Brazilian cotton production is forecast to rise by 1.21 per cent monthly and 14.8 per cent year-on-year, potentially reaching a record 3.64 million tons.
Data from the United States Department of Agriculture (USDA), released on May 10, indicate that global cotton production for the 2024-25 season may total 25.919 million tons, a 4.8 per cent increase from the 2023-24 crop. Global consumption is expected to rise by 3.1 per cent compared to the 2023-24 season, reaching 25.442 million tons.
Fibre2Fashion News Desk (KD)