Cotton prices significantly decreased in the Brazilian spot market towards the end of June. This reduction was aligned with trends in the international market, which were influenced by the forecast of favourable weather conditions in the United States, a decrease in oil prices, and a slow pace of US cotton sales, as per the Center for Advanced Studies on Applied Economics (CEPEA).
The downward trend was further amplified by certain sellers in Brazil demonstrating more flexibility. However, other producers decided to stay away from the spot market, in hopes of a potential recovery in prices or better opportunities. Regarding the buyers, a majority of the industry has been operating at a diminished capacity. As a result, buyers remained hesitant to engage in new transactions, CEPEA said in its latest fortnightly report on the Brazilian cotton market.
From May 31 to June 30, the CEPEA/ESALQ Index for cotton decreased by 12.51 per cent, closing at BRL 3.5984 per pound on June 30.
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