CEPEA Cotton: Prices See Fourth Consecutive Monthly Increase
Brazilian cotton prices marked their fourth consecutive monthly increase in May, driven by the firm stance of sellers holding high-quality cotton from the 2024/25 harvest, according to CEPEA researchers. Despite cautious buyers limiting market liquidity, the CEPEA/ESALQ cotton indicator rose 3.31%, reaching R$4.2793/lb, its highest nominal value since June 2025.
According to the latest analysis from the Center for Advanced Studies in Applied Economics (CEPEA) at the University of São Paulo, Brazilian cotton prices experienced their fourth consecutive monthly increase in May. This sustained upward trend was primarily fueled by the firm stance of sellers who still hold remaining lots from the 2024/25 harvest, especially those with superior quality, effectively bolstering market prices.
Despite the strong confidence from sellers, market liquidity was somewhat constrained by the cautious approach of buyers. This led to negotiations being sporadic and targeted, with a degree of contention between buyers and sellers regarding pricing. Against this backdrop, the CEPEA/ESALQ cotton indicator (for eight-day payment terms) advanced by 3.31% between April 30 and May 29.
The indicator ultimately closed at R$4.2793 per pound, marking its highest nominal value since June 16, 2025, when it reached R$4.3643 per pound. This data indicates that despite some market hesitancy, the scarcity of high-quality cotton and the bargaining power of sellers remain crucial factors driving price appreciation.