Producers offer cotton to Iran in exchange for fertilizers

The Brazilian Association of Cotton Producers (Abrapa) has been negotiating with the Iranian government. The organization wants to secure the purchase of Iranian fertilizers such as urea, widely applied in cotton crops, through exchanging the production for inputs, a practice known as bartering.

“They send us urea and we send them cotton. It would be a good way of doing business, of strengthening our relationship”, says the president of Abrapa, Júlio Cézar Busato. Brazilian cotton growers, who are mainly concentrated in Mato Grosso and Bahia, use approximately half a ton of urea per hectare of cotton grown. Bartering is already done by Brazilian soy and corn exporters, who ship large volumes of grain and receive the fertilizer back.

Iran suffers economic sanctions from the United States, which makes trading with some countries difficult. Currently, the Iranians produce around 50,000 tonnes of cotton and import up to 150,000 tonnes, supplied by Kazakhstan and India. The country is on the list of the ten biggest world buyers of the product and its textile industry is expanding.

“It is a market of 150 thousand tons that interests us a lot”, says Busato. “Brazilian cotton is of excellent quality and they are looking to replace their supplier.”

In early December, the association’s met with the Iranian ambassador to Brazil, Houssen Gharibi, who confirmed his interest in Brazilian cotton. “We are looking at Brazil as an import source. As we are a large producer of petrochemicals and fertilizers, we can supply some materials to be exported to Brazil”, said the diplomat in a video published by Abrapa.

Check out the main destinations for Brazilian cotton in 2021. Data are from DataLiner:

Top 8 destinations for Brazilian Cotton exports (HS 5201) | Jan to Nov 2021 | WTMT

Source: DataLiner (click here to request a demo)

In February, the organization will hold an event to promote Brazilian cotton in Iran. Currently, Brazil does not export directly to the Iranian market. “Brazil has accessed this market indirectly, through other countries that end up re-exporting to the Iranians. Our objective is to establish a direct export path there,” said, in a statement, the director of International Relations at Abrapa, Marcelo Duarte.

Source: Valor Econômico

To read the full original article visit:

https://valor.globo.com/agronegocios/noticia/2021/12/26/produtores-oferecem-algodao-ao-ira-em-troca-de-fertilizantes.ghtml

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