This contrasts with the international trend, where values have been steadily climbing, widening the gap between domestic and overseas quotations, and leading to sporadic increases in the local market.

According to CEPEA’s analysis, export parities FAS (Free Alongside Ship) surged by 4.1 per cent between January 31 and February 9, reaching BRL 4.1782 per pound ($0.8427 per pound) at the port of Santos (SP) and BRL 4.1888 per pound ($0.8449 per pound) at the port of Paranaguá (PR) on February 9. Meanwhile, the Cotlook A Index witnessed a 3.88 per cent increase during the same period, hitting $0.9685 per pound on February 9. The dollar also saw a modest 0.22 per cent appreciation against the Real between January 31 and February 9, closing at BRL 4.958 on February 5, CEPEA said in its latest fortnightly report on the Brazilian cotton market.

The latest report by Brazilian National Supply Company CONAB, released on February 8, projected a potential 12.8 per cent expansion in the cotton area for the 2023-24 season, totalling 1.877 million hectares, alongside a 6.10 per cent increase in production compared to the previous month and a historic high of 3.288 million tons.

Meanwhile, data from the International Cotton Advisory Committee (ICAC) released on February 1 estimates global cotton production for the 2023-24 season at 24.481 million tons, marking a decrease of 0.32 per cent compared to the data from January 2024 and a 1.46 per cent decline compared to the previous season. Consumption, on the other hand, may total 23.762 million tons, remaining stable in relation to the previous report but slightly higher (+0.36 per cent) than the 2022-23 crop. Therefore, consumption may be 2.94 per cent smaller than the supply.

Fibre2Fashion News Desk (KD)