In recent years, the continuous depreciation of the Brazilian currency real against the US dollar has stimulated the cotton export of Brazil, a large cotton producing country, and led to a sharp rise in the retail price of Brazilian cotton products in the short term. Some experts pointed out that under the spillover effect of the Russian Ukrainian conflict this year, the domestic cotton price in Brazil will continue to rise.
Chief reporter Tang Ye: Brazil is the fourth largest cotton producer in the world. However, in the past two years, the cotton price in Brazil has increased by 150%, which directly led to the fastest increase in the clothing price of Brazil in June this year. Today we come to a cotton production enterprise located in Central Brazil to see the reasons behind it.
Located in Mato Grosso State, Brazil's main cotton production area, this cotton planting and processing enterprise owns 950 hectares of land locally. At present, the cotton harvest season has come. This year's lint output is about 4.3 million kilograms, and the harvest is at the low point in recent years.
Carlos Menegatti, marketing manager of a cotton planting and processing enterprise: we have been planting cotton locally for more than 20 years. In recent years, the way of producing cotton has changed greatly. Especially since this year, the cost of chemical fertilizers, pesticides and agricultural machinery has increased significantly, which has increased the production cost of cotton, so that the current export earnings are not enough to cover our production cost next year.
Brazil is the fourth largest cotton producer and the second largest cotton exporter in the world after China, India and the United States. In recent years, the continuous depreciation of the Brazilian currency real against the US dollar has stimulated the continuous increase of Brazil's cotton export, which is now close to 70% of the country's annual output.
Cara Benny, economics professor of Vargas Foundation: Brazil's agricultural export market is vast, which compresses the cotton supply in the domestic market. After the resumption of production in Brazil, people's demand for clothing suddenly increased, which led to a shortage of products in the whole raw material market, further pushing up the price.
Carla Benny believes that in the future, due to the continuous increase in the demand for natural fibers in the high-end clothing market, the cotton supply in Brazil's domestic market will continue to be squeezed by the international market, and the price will continue to rise.
Cara Benny, Professor of economics at the Vargas Foundation: it is worth noting that Russia and Ukraine are major exporters of grain and chemical fertilizers, which are related to the output, price and export of Brazilian agricultural products. Due to the uncertainty of the current (Russian Ukrainian conflict), it is likely that even if the output of Brazil increases, it will be difficult to overcome the shortage of cotton and the rising price in the domestic market.
Post time: Sep-06-2022