São Paulo – Brazil should import 51,000 tonnes of cotton lint in the 2012-2013 crop, according to estimates from the National Supply Company (Conab, in the Portuguese acronym). The volume is down 69% from the previous projection, issued in May, which was 163,000 tonnes. According to information released by Conab, the exchange rate for imports is not proving advantageous, and Brazilian growers are reverting flexible contracts (which may apply to exports or domestic sales) into domestic consumption.
The Conab has also revised down its cotton lint export forecast from 595,000 tonnes to 530,000 tonnes. “The reduction stems from lower-than-expected imports thus far. It is also worth noting that some of the flexible contracts on the Brazilian Commodities Exchange have been reverted into the domestic market,” the company reported in its latest crop survey. The cotton export volume forecast has been revised down by 11%.
Brazil imports and exports cotton to and from the Arab countries. Last year, Brazilian exports of the product to Arab countries generated US$ 173.1 million in revenues. In 2011, sales amounted to US$ 186.4 million. In the first seven months this year, exports stood at US$ 58.56 million.
Brazilian cotton imports from Arab countries amounted to US$ 10.8 so far this year, and to US$ 24.57 million last year. In 2011, Brazil imported US$ 76.53 million worth of cotton from Arab countries. Brazil’s cotton imports from Arab countries consist mostly of the long-thread variety, which is made in Egypt and is used in making higher-end clothing. Up until the end of this month, imports of cotton amounting to up to 80,000 tonnes are exempt from the 10% tariff.
According to projections from the Conab, Brazil will harvest 1.262 million tonnes of cotton yarn, as against 1.87 million in the previous crop. The volume should be down by down 32.8%, or 615,300 tonnes. Planted area has decreased in the country, as a result of lower domestic and foreign prices, and also due to higher production costs and because soy and maize are more attractive, price-wise. In most producing states, the crops are either maturing or beginning to be harvested now.
*Translated by Gabriel Pomerancblum
