Brazil’s cotton prices reached a one-year high in mid-March with the CEPEA/ESALQ Index closing at BRL 4.2582 per pound. Market trends indicate a focus on international contracts, buoyed by recent price hikes globally. February saw record exports, although there was a decline compared to January, with overall growth in world cotton production and consumption projected.
In March, Brazil’s cotton prices experienced fluctuations yet maintained an upward trend, according to the Centre for Advanced Studies on Applied Economics (CEPEA). By mid-March, the CEPEA/ESALQ Index attains its highest value in one year, rising by 1.92 percent from February 28 to March 14 and closing at BRL 4.2582 (approximately $0.75) per pound, marking a nominal peak since March 14, 2023.
Market participants are increasingly focused on securing term contracts, particularly for international transactions, which have been concluded at values exceeding those in the domestic market, as reported by CEPEA. Confidence among sellers has bolstered due to recent price increases in the global cotton market, encouraging them to adopt firm pricing strategies in new spot market trades. Demand remains steady as industry buyers acquire cotton to restock inventories or satisfy current production needs.
According to Secex data, Brazil exported 274.63 thousand tons of cotton in February, setting a record for that month, despite a 33.9 percent decline compared to January 2025. Over the past year, Brazilian cotton exports exceeded 2.9 million tons. The International Cotton Advisory Committee (ICAC) anticipates global cotton production for the 2024/25 season at 25.688 million tons, a 0.55 percent increase from the previous estimate and a 6.52 percent rise compared to the 2023/24 season.
Furthermore, global cotton consumption is estimated to climb to 25.527 million tons, indicating a year-on-year growth of 2.27 percent. This projection illustrates a minimal gap of 0.63 percent between supply and demand, highlighting the robust dynamics of the international cotton market.
In summary, Brazil’s cotton market is witnessing significant price increases, with the CEPEA/ESALQ Index reaching its highest value in a year. The focus on international contracts and steady demand underscores sellers’ confidence amidst global market trends. Additionally, record exports in February and projected growth in both production and consumption of cotton reflect the strength and resilience of the sector.
Original Source: www.fibre2fashion.com
