Cotton: Business pace is slow and prices continue to fall

Liquidity has been low in the cotton lint market in recent days. According to Cepea employees, industries show low interest in new acquisitions, working with the plume already contracted and waiting for the harvest to progress. Furthermore, some companies claim that the sale of by-products is lower than expected, which has increased inventories.

On the seller's side, many are flexible regarding prices, even with the availability of the product from the 2017/18 harvest. The supply for the 2018/19 season is also limited, as processing remains at a slow pace. In this way, sellers were active on the spot to carry out small replacements and/or deliver contracts.

In this scenario, negotiations for future deliveries in domestic and foreign markets, involving the plume from the 2018/19 and 2019/20 harvests, remain slow. Between June 18th and 25th, the CEPEA/ESALQ cotton lint indicator, with payment in 8 days, fell 1.6%, closing at R$ 2.7410/lp, this Tuesday, 25th.

Post: Marina Carvejani
Author: CEPEA/ESALQ
Source: agrolink

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