Brazilian cotton index remains stable in April

Between March 29 and April 30, the Center for Advanced Studies on Applied Economics (CEPEA)/ESALQ cotton Index, with payment in 8 days, rose a slight 0.46 per cent, closing at 2.9480 BRL per pound on April 30, according to the latest report on the Brazilian cotton market released by CEPEA.

“Some processing plants were working with the product stocked and/or from deals previously closed, while other purchasers were buying cotton at quotes lower than asking prices. Only the purchasers that were searching for higher quality cotton were willing to pay more for the product,” the report said about the market.

Traders were searching for batches to accomplish contracts previously closed. However, the large volume of mixed quality batches was hampering deals, the report added.

Meanwhile, according to data from the Brazilian Commodity Exchange BBM tabulated by CEPEA, 71.4 per cent of the 2017-18 Brazilian crop, estimated at 2.005 million tons, may have been traded until April 30. Of this total, 57.7 per cent was allocated to the Brazilian market, 31.6 per cent to the international market, and 10.7 to flex contracts i.e. for exports with an option to sell in the Brazilian market.

For the next season, data indicates that at least 27.8 per cent of the 2018-19 output (forecast at 2.647 million tons by Conab) was traded in the same period, with 42.9 per cent allocated to the Brazilian market, 35.8 per cent to exports, and 21.3 per cent to flex contracts. (RKS)

Fibre2Fashion News Desk – India