During November, cotton prices in the Brazilian market were pressured by sales that prevailed over purchases, Cepea said on its website. “In general, industries were retracted and liquidity was low. Trades closed were, basically, for small batches to meet demands in the short-term.”
In November, the CEPEA/ESALQ Index, with payment in 8 days, for cotton type 41-4, delivered in São Paulo, decreased 3.41 per cent. The monthly average, at 2.2923 BRL ($0.606) per pound, was 2.51 per cent below that in October 2015, but 26.84 per cent higher than that in November 2014 (values deflated by IGP-DI from October 2015).
Normally, during this period of the year, liquidity decreases in Brazilian market as many cotton spinning units give vacation to employees. However, owing to the weak development of the Brazilian economy, and consequently, of the textile sector, this vacation may get prolonged this year. Thus, industries are working, basically, with cotton traded previously.
According to Brazilian Commodity Exchange (BBM) data calculated by Cepea, 54.2 per cent of the 2014-15 crop, forecast at 1.53 million tons, had already been traded until November 30. From this total, 40.1 per cent was allocated to the domestic market and 59.9 per cent to the international market.
About 25.8 per cent of the 2015-16 cotton crop, forecast at 1.47 million tons, has already been traded, the website said.