Producers anticipate record September cotton exports as Brazil eyes global leadership

Brazil is poised to reach the end of the month with the highest cotton exports ever recorded in September, with approximately 200,000 metric tonnes. This signals that Brazil is on track for a new record in cotton exports during the 2023/24 marketing year, as a recently harvested bumper crop contributes to the country’s potential to become the world’s largest cotton exporter in the current cycle.

This assessment comes from Miguel Faus, President of the National Association of Cotton Exporters (Anea). In an interview with Reuters, he expressed confidence that Brazil could export a record-breaking volume of approximately 2.5 million metric tonnes of cotton from July 2023 to June 2024.

This would represent a growth of more than 1 million metric tonnes compared to 1.396 million metric tonnes in 2022/23, a year in which Brazil faced challenges with key buyers such as Turkey, Pakistan, and Bangladesh.

If this record materializes, Brazil could potentially surpass the United States as the world’s largest cotton exporter, a possibility that has gained traction recently.

The chart below shows Brazil’s cotton exports (hs 5200-5201), measured in tonnes, recorded between January 2019 and July 2023. The data is from DataLiner.

Cotton exports from Brazil | January 2019 – July 2023 | WTMT

Source: DataLiner (click here to request a demo)

“At this moment, Brazil has overtaken the United States as the third-largest producer,” said Faus, citing data from the U.S. Department of Agriculture (USDA), which indicates the 23/24 American harvest (recently initiated) at 13.13 million bales, while Brazil’s stands at 13.8 million bales.

“It’s possible that during this cycle, Brazil could surpass the United States in exports due to their crop shortfall. But we must not forget that this leadership would be due to production issues.”

According to the latest USDA survey released this month, the United States still leads Brazil in 2023/24 with an export projection of 12.3 million bales versus Brazil’s 11.8 million.

In the medium term—three to five years—Brazil is expected to solidify its position as the third-largest producer, trailing China and India, ultimately becoming the top cotton exporter, surpassing the United States, thanks to higher Brazilian productivity and available land.

Previously, producers told Reuters that Brazil’s export leadership could have occurred in the calendar year 2023, but Brazilian shipments in the first half of the year were weaker than expected.

SEPTEMBER

September’s numbers set the tone for the expected recovery. Brazilian cotton shipments are expected to reach approximately 200,000 metric tons, nearly doubling from August and growing compared to the 184,800 metric tonnes shipped in the same month of 2022.

“If it doesn’t reach 200,000 metric tonnes, it might come close to it… It could be a historical record for September,” said Faus, after Brazil had shipped 154,000 metric tons of cotton in the month’s cumulative total up to last week, according to data from the Secretariat of Foreign Trade (Secex).

With a daily average of over 10,000 metric tonnes in shipments, according to Secex, September could also record the highest monthly level of 2023.

“With the advancement in processing (of cotton), a highly productive harvest, we believe that achieving a record in exports (in 23/24) would be feasible,” said the President of Anea, noting that Brazil produced over 3 million metric tonnes of cotton in the recently concluded harvest.

According to association data, the country’s previous export record was in 2020/21, with 2.41 million metric tonnes.

Faus mentioned that in the first half of the year, Brazil dealt with the impact of the earthquake in Turkey on cotton demand, as well as financial difficulties in other major importers like Pakistan and Bangladesh, which had trouble with letters of credit, a crucial document for exports.

However, China, the largest importer, is returning to the market, and this trend is expected to continue for the next ten months, boosting Brazilian shipments, he said.

“In the coming months, October, November, December, Brazil is expected to exceed 200,000 metric tonnes per month,” he emphasized.

According to him, Brazilian cotton is competitive in terms of prices and quality. “The price offered is slightly below the price of the United States due to our large harvest,” he said, noting that another advantage of Brazilian cotton is its traceability, a key factor in meeting sustainability certification criteria.

In August, Brazil made its first cotton shipment to Egypt following the market opening, albeit a small volume of 1,500 metric tons. “Still a small volume but significant because Egyptian cotton is recognized for its quality.”

Source: Notícias Agrícolas

To read the original news report, visit: https://www.noticiasagricolas.com.br/noticias/algodao/360447-exportacao-de-algodao-do-brasil-deve-ser-recorde-para-setembro-anea-preve-lideranca-global.html

Sharing is caring!