Brazilian cotton prices reached a one-year high in mid-March, driven by upward trends noted by CEPEA. The CEPEA/ESALQ Index rose 1.92% to BRL 4.2582 (~$0.75) per pound. International contracts are favorable, despite a 33.9% drop in February exports compared to January. Global production and consumption forecasts for 2024/25 indicate significant growth, with a narrow supply-demand gap.
In March, Brazilian cotton prices demonstrated upward movement, with the Centre for Advanced Studies on Applied Economics (CEPEA) noting fluctuations early in the month. By mid-March, the CEPEA/ESALQ Index peaked at BRL 4.2582 (~$0.75) per pound, marking its highest level in a year. From February 28 to March 14, the Index increased by 1.92%, exceeding its previous high of BRL 4.2754 per pound from March 2023.
Market players are prioritizing securing term contracts, particularly internationally, where transaction values are higher compared to domestic prices. This upward shift in global market prices has enhanced sellers’ confidence, leading to firm price strategies for new transactions. With demand persisting, buyers are purchasing cotton to build inventories or fulfill immediate production requirements.
According to Secex data, Brazil exported a record 274.63 thousand tons of cotton in February. However, this figure represents a 33.9% decline compared to January 2025. Over the previous year (March 2024 to February 2025), Brazilian cotton exports surpassed 2.9 million tons, indicating robust activity.
The International Cotton Advisory Committee (ICAC) reports that global cotton production for the 2024/25 season may total 25.688 million tons, a 0.55% increase from February estimates and up 6.52% from 2023/24. Global consumption is also anticipated to rise by 2.27% year-on-year to reach 25.527 million tons, leaving a narrow gap of only 0.63% between supply and demand.
Brazil’s cotton market is experiencing a positive trend, with prices reaching a one-year high amid robust demand, both domestically and internationally. Despite a decrease in exports compared to the previous month, the overall volume shipped remains significant. Additionally, forecasts suggest increases in global cotton production and consumption, indicating a tightening supply-demand balance.
Original Source: www.fibre2fashion.com
