CEPEA Cotton: Prices Rise Driven by Exports and Parity
According to CEPEA, Brazilian domestic cotton lint prices rose for the fifth consecutive month in April, reaching their highest nominal levels since July 2025. This surge was primarily fueled by strong export performance, which reduced domestic inventories, and an increase in oil prices. Despite this, domestic market liquidity remained limited, with both buyers and sellers adopting a cautious stance.
According to the latest report from the Center for Advanced Studies on Applied Economics (CEPEA) at the University of São Paulo, Brazilian domestic cotton lint prices continued their upward trend in April 2026, marking the fifth consecutive month of increases. This price surge has brought cotton lint to its highest nominal levels since July 2025. CEPEA attributes this momentum primarily to the robust performance of Brazilian cotton exports, which has effectively drawn down domestic inventories, alongside the supportive influence of rising international oil prices.
However, the report also highlights that despite the price appreciation, liquidity in the domestic market remains constrained. This is largely due to a combination of price and/or quality discrepancies among market participants, leading both buyers and sellers to adopt a cautious stance. Industrial players are prioritizing the consumption of existing stocks and fulfilling pre-arranged forward contracts. Concurrently, traders are predominantly focusing on 'matched' negotiations and making punctual acquisitions to meet specific demands, reflecting the complex and somewhat uncertain market dynamics at current elevated price points.