In order to increase the cotton growers' income in a period of low prices and high costs, on May 8th the Brazilian government announced the first Pepro's auction for this crop (2007/08), which is expected to happen on May 15th. In April, the CEPEA/ESALQ Index for the type 41-4 (delivered in Sao Paulo city, payment in 8 days - the most common commercialization) registered the lowest average for the period, in real terms, of 1.3609 real or 0.8053 dollar per pound.
During the first fortnight of May, prices kept moving down, even with the off-season period. Between April 30th and May 15th, the CEPEA/ESALQ Index dropped 1.5 percent in Real, closing at 1.2908 real or 0.7776 dollar a pound on Thursday, May 15th. Due to the decreasing international quotations and the Real appreciation against the dollar, buyers have been trying to trade at inferior values.
According to Secex (Foreign Trade Secretariat), Brazilian cotton exports totaled 23,47 tons in April, volume 1.7 percent higher over March/08 and 112.1 percent superior compared to Abr/07. (Cepea - Brazil)