The low domestic demand and differences between asking and bidding prices limited cotton trades in February. In this scenario, prices moved down in the Brazilian market. In spite of some refrained sellers, cotton dealers were more flexible in regard of sale prices. The lower export parity also pressed down values in Brazil.
Between February 21-28, the CEPEA/ESALQ Index for cotton type 41-4 moved down 0.71% and closed at 2.2385 real (0.9558 dollar) per pound on February 28. In the accumulated of the month, the Index downed 2.61%.
After the intense pace of purchases in January, players from the industry claim that they are supplied for processing. Companies say that they faced difficulties to transfer cotton price rises to by-products in the first two months of the year.
In late February, cotton sellers were refrained, mainly to sell high-quality batches, expecting higher quotes. Moreover, producers were focused on cotton activities on the field and/or the soybean harvesting. Many players were still concerned with weather conditions and possible impacts on the revenue.
In several areas surveyed by Cepea, weather conditions were instable. In Mato Grosso, rains were frequent. On the other hand, the humidity was low in Minas Gerais and Bahia, despite some rain showers. (Cepea – Brazil).