Brazilian cotton prices perk up in second fortnight of July

After declining in the first fortnight of July, Brazilian cotton prices started regaining lost ground and started increasing in the second fortnight of July.

Cotton availability in the spot market fell in mid-July, although harvesting of the 2015/16 crop was steady and firm, thereby pushing up cotton prices.

“Keeping an eye on international price rises, Brazilian cotton sellers pushed for quicker deliveries in the domestic market, leading to a quickening of pace in cotton trades,” CEPEA said in a report.

Although textile mills were slower in purchasing in late July, Brazilian traders ensured higher liquidity and stability to prices.

In the second fortnight of July, traders searched for batches to accomplish contracts for prompt-delivery, while processors were cautious about buying new batches, concerned with the prices.

Brazilian cotton growers continued harvesting and processing cotton from the new crop, but a lack of rains in some producing regions, resulted in a production break, a scenario that concerned growers.

Between June 30 and July 29, the CEPEA/ESALQ Index, with payment in 8 days, for cotton type 41-4, delivered in São Paulo, dropped 1 per cent, closing at BRL 2.63 or $0.8123 per pound on July 29.