Brazilian cotton harvest 2024/25 estimated to fall by 0,7%

The Brazilian cotton harvest for 2024/25 was re-estimated to produce 3,85 million tonnes (m/t) of lint, according to information from StoneX, a global financial services company. Comparing the May estimate with this most recent one, there is a drop of 0,7%.

According to the report, the reduction was a consequence of a deterioration in expectations regarding the state of Bahia, which had already been monitored by the consultancy. In the April estimate, drier weather was reported in the region throughout the month of March, which was added to rains closer to the harvest, worsening conditions in the final stretch of the season.

“The wetter weather on the eve of the harvest has led to greater sensitivity in the lower third of cotton plants in some regions, causing bolls to fall in some cases. With this adverse scenario, the average productivity in the state of Bahia will be 1,77 tons per hectare (t/ha), one of the lowest values ​​in recent years,” explains StoneX Market Intelligence analyst Raphael Bulascoschi (pictured).

In Mato Grosso, vegetative development was generally quite favorable. The rains extended into periods that are normally drier, benefiting the development of second-harvest crops. However, the continuation of the rainy season throughout the month of June could harm both the harvest pace and the quality of the fiber.

“For this reason, productivity estimates were not revised, as the harvest is expected to progress so that production levels can be assessed more accurately,” Bulascoschi points out.

Exports maintained at 2,9 million tons

The recent supply and demand balance indicates that, despite the slower pace of exports in recent weeks, the estimate for Brazilian cotton shipments in 2024 remains at 2,9 million tons. The expectation is that the volume exported will grow again in the second half of the year, with the entry of the new harvest into the market.

However, the external scenario remains challenging. Global demand still shows signs of weakness, and, in addition, the real has appreciated against the dollar in recent months, penalizing the competitiveness of Brazilian cotton vis-à-vis importers. This is a factor that should continue to be monitored throughout the year.

“In the domestic market, the consultancy revised downwards the estimate for cotton consumption, which is now 700 thousand tons. The market has had difficulty absorbing the fiber and demand remains slow in the domestic market”, highlights Bulascoschi.

Therefore, with the combination of a drop in production and a decline in consumption, final stocks should remain relatively stable, estimated at 2,7 million tons.