In Brazil the prices of cotton continued to rise in March due to sellers staying firm on their quotes, majorly observing the high increases in future contracts at ICE futures.
According to the Center for Advanced Studies on Applied Economics (CEPEA), CEPEA/ESALQ Index between February 25 and March 31, for cotton rose by 5.4 percent.
On March 31, the CEPEA/ESALQ Index closed at BRL 7.2585/pound, setting a new record since the CEPEA series began in 1996.
As for purchasers, in March, many processors were working with the cotton stocked and/or receiving the product previously purchased because of the price levels during the month.
According to CEPEA collaborators, some processors were working with reduced capacity, claiming difficulties to sell by-products and raise their prices.
Retailers reported weak sales, as the purchase power of Brazilian people has been low. Some deliveries and payments were even postponed.
Besides, sellers continued to ask higher prices, constraining liquidity in the spot market.
Also, the quality of the cotton available did not meet processors’ requirements, this also limited sales.