ANEA forecasts strong growth in cotton exports despite corona virus

Brazil is the second largest cotton exporter in the world after the USA, and has just finished planting the largest cotton area in history, with production expected to grow 2.7% to 2.85 million tons, according to figures from the National Supply Company (Conab). Forecasts are that this year Brazil has the potential to raise its export volumes by up to 2 million tons between July 2020 and June 2021.  This would mean the achievement of another record after the one expected for the 2019/20 period. This forecast was made by the director of the National Cotton Exporters Association (Anea), Miguel Faus.

According to the executive, the projection already considers the impacts of the coronavirus pandemic, which started in China but should no longer affect business when the new crop is ready to be exported. It is worth noting that China is Brazil’s main buyer, absorbing more than 30% of its exports. In the export trade year ending in June 2020, shipments from Brazil are expected to have grown by around 50% year-on-year, with both an increase in the harvest, and Chinese demand increasing due to the trade war with the United States, both contributing to this trend.

Faus, also an executive at US-based trading company Omnicotton, said that cotton exports from Brazil, which hit a monthly record of over 300,000 tons in January, are slowing down at the moment, but this is because most of the end of the harvest has already been shipped.  “We will continue shipping, but in smaller volumes due to the end of the season. There is no effect (of the coronavirus) on shipments ”, he said.  “And, until the new harvest reaches volume, I hope that the main problems have already been solved in relation to the virus”, added Faus, in reference to the harvest that begins at the start of the second semester.

Source: Reuters

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