Lower supply supports domestic values

Brazilian cotton prices kept moving up during the second fortnight of April, supported by the lower supply. Between April 16 and 30, the CEPEA/ESALQ Index (type 41-4, delivered in Sao Paulo city) upped 2.4 percent in Real and 1.6 percent in dollar, closing the period at 1.3979 real or 0.6811 dollar a pound. In the month, the valuation reached 5 percent in Real and 6.3 percent in dollar. On buyers' side, even with some textile mills less willing to trade, the wholesaler demand was enough to support the values.

The volume available in the market is basically related to the rest of the 2005/06 crop, when the quality of the product is normally inferior to the average obtained during the season.

Regarding the new crop (2006/07), some cotton from the Mato Grosso do Sul and Sao Paulo states has been already traded in the domestic market, but at small quantities.



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