'Brazil's Cost' Offset by Wealth of Advantages

摘要

Brazilian cotton was priced at 78 cents at the beginning of 2010, reached a record $2.43 on March 10, 2011, and came back to 88 cents in December 2011 on the domestic spot market - the most volatile time in the market's history. This situation exposesthe entire cotton industry to enormous risk. The perspective of the Brazilian cotton industry should be evaluated in light of two trends: 1. Cotton production has shifted from about 1.2 million tons to about 2 million tons. 2. The textile industry is going in the opposite direction. Although cotton consumption has been close to 1 million tons over the last three years, many companies are in financial crisis due to the volatility. National consumption likely won't exceed 40% (700,000 to 800,000 tons), leaving the remainder for exports.