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February 7, 2012

Dryer Weather Encourages Cotton Planting in Brazil

Farmers in Mato Grosso have taken advantage of the recently dry weather to increase the pace of cotton planting. According to the Mato Grosso Institute of Agricultural Economics (Imea), the cotton crop in the state is now 83% planted, which is an increase of 15% compared to the previous week. Even with this increase, the cotton planting in the state is still slightly behind last year's pace.

The heavy rains that fell during January slowed the pace of the soybean harvest and thus the planting of the safrinha cotton crop. With the recent dryer weather, the soybean harvest has picked up and so too has the planting of the safrinha cotton. The planting window for safrinha cotton in Mato Grosso usually closes by the end of January, but if need be, the cotton could still be planted until mid-February.

Mato Grosso is the largest cotton producing state in Brazil responsible for 50% of the total Brazilian production. Imea estimates that Mato Grosso will plant 733,000 hectares of cotton, which is only slightly more than in 2010/11. Conab is estimating that Mato Grosso will produce 975,000 tons of cotton and the total Brazilian crop in 2011/12 will be 1.99 million tons.

The cotton farmers have already forward contracted approximately 50% of their anticipated production, but forward contracting is now very slow as farmers wait for firmer prices.