Firm prices in the year

The year of 2006 was marked by firm cotton prices in Brazil. The support comes especially from the lower volume produced in the states of Sao Paulo, Parana and Mato Grosso do Sul. Moreover, harvest activities were delayed in the states of Mato Grosso, Goias and Bahia, due to rainfalls and low temperatures.

The CEPEA/ESALQ Index (type 41-4, delivered in Sao Paulo city) accumulated an increase of 16.43 percent in the year, closed at 0.6271 dollar a pound on December 27th. The 2006 average was of 0.6043 dollar a pound, 13.95 percent higher than in the 2005. This level, however, is superior only to the one from the last year - it represents the second lower level of the history.

In the last week of 2006, Brazilian cotton market moved at a slow pace, as usual for this period of the year. Most of the players are out of the market, returning in January. Some growers are focused on planting activities in the Center-Southern and Northeast regions, which reduce even more the supply.

Regarding Brazilian exports, according to Secex, until November, it was exported 270.3 thousand tons, volume 17.5 percent lower than the same period of 2005.

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