Cepea, 02/01/2025 – Brazilian cotton lint output grew in 2023 for the third consecutive year, while U.S. output fell. This scenario led Brazil to become the world's largest lint exporter in 2024, overtaking the United States, which had held the top spot since the 1993/94 crop. Domestic cotton farming has been expanding its area every year, with producers encouraged by profitability, technological progress and high product quality. However, domestic demand shows modest growth and domestic surpluses grow every year. As a result, support for lint prices comes from the international market. And throughout 2024, despite certain swings in external prices and the exchange rate, the domestic lint price moved within a relatively narrow range – the low for the CEPEA/ESALQ index, with 8-day payment terms, was R$ 3,8063/lp and the high was R$ 4,3645/lp. For practically the entire year, average prices, in real terms, traded below those recorded in 2023. In the first quarter of the year, the domestic price held firm, influenced by strong gains abroad. In the second quarter, however, declines abroad and sellers' interest in clearing the remaining balance of the 2022/23 crop pressured prices. Despite the arrival of the new crop at the start of the third quarter, prices held firm, as sellers chose to prioritize fulfilling forward contracts, limiting spot supply. In the following months, prices “moved sideways”, finding some support in December, given the rise in export parity due to the dollar's surge. In the field, the area planted in the 2023/24 crop was 16,9% larger than the previous one, totaling 1,944 million hectares, the largest since 1991/92. Output was projected at 3,7 million tonnes, up 16,64% from the previous crop and a record. Source: Cepea (www.cepea.esalq.usp.br)