Brazilian cotton prices kept moving down during the second fortnight of February. Even with the limited supply, growers and wholesalers accepted to trade at lower values, focused on releasing stocks from the 2006/07 crop production or due to the necessity of cash.
Between Feb 18th and 29th, the CEPEA/ESALQ Index for the type 41-4 (delivered in Sao Paulo city) dropped 0.6 percent in Real, closing at 1.3761 real or 0.8143 dollar per pound on Feb 29th. In the accumulated of the month, the decrease was of 2.8 percent in Real.
According to the Brazilian Commodity Exchange (BBM), until Feb 29th, 1.32 million tons of the cotton from the 2006/07 crop were already traded, which represents 87 percent of the national production predicted by the Conab (1.52 million tons). The production exceed, of 205 thousand tons, would not be enough to supply the consumption forecasted at 1 million tons, since 693 thousand tons were already traded in the domestic market.
To export, the market kept moving at a slow pace. Few growers were willing to settle contracts neither to the 2007/08 crop nor to the 2008/09 crops. (Cepea - Brazil)