Due to the harvesting progress of the cotton from the 2007/08 crop, textile mills retreated last days, trying to trade at lower prices. Some growers, in need of cash, accepted inferior values. Most part of them, however, kept focused on accomplishing export and domestic contracts. Between June 30th and July 15th, the CEPEA/ESALQ Index for the type 41-4 (delivered in Sao Paulo city, payment in 8 days - the most common commercialization) decreased 1.4 percent in Real, closing at 1.2780 real or 0.8038 dollar a pound this Tuesday, Jul 15th.
Regarding to the cotton from the previous season, the supply is decreasing day by day. According to the Brazilian Commodity Exchange (BBM), until July 11th, 1.43 million tons of the cotton from 2006/07 crop were already traded, which represents 94 percent of the total projected by the Conab - Brazilian government (1.52 million tons).
The demand reduced, once textile mills are waiting higher volumes of the new crop and, as a result, lower values. The decreasing international quotations, which pressed the import parity, also reinforced buyers' retreat. (Cepea - Brazil)