Aug 08, 2018

Early Cotton Yields in Brazil surpass Expectations

Author: Michael Cordonnier/Soybean & Corn Advisor, Inc.

Brazilian farmers are starting to harvest their 2017/18 cotton crop and they are very pleased with the early results. In the municipality of Nova Mutum in central Mato Grosso, farmers are reporting early yields that are 15-20% higher than expected. Since Mato Grosso is the largest cotton producing state in Brazil, good yields out of Mato Grosso are important for Brazil's total cotton production. In fact, Conab estimates that the 2017/18 Brazilian cotton crop will be almost 2 million tons or 28% larger than last year, setting a new record production

Farmers in Mato Gross increased their cotton acreage in 2017/18 in response to very strong cotton prices. The Mato Grosso Institute of Agricultural Economics (Imea) estimates that farmers increased their cotton acreage by 21% to 782,900 hectares. Of the total acreage, 86% is planted as a second crop following soybeans and 14% is planted as full-season cotton. The full-season cotton is planted in December and he safrinha cotton is generally planted in January and early February.

Farmers in Mato Grosso also produce very high quality cotton because the cotton is planted during the summer rainy season, but the bolls open and the crop is harvested during the dry season when there is very little chance of rain. The quality of the cotton in Mato Grosso is equal to the quality from Australia where the crop is 100% irrigated.

On a recent Global Rural TV show in Brazil, they explained the measures some farmers utilize to insure the highest possible quality of their cotton. As soon as the bolls start to open up, all unnecessary traffic on the dirt roads within the farm is prohibited. The reason is because these dirt roads produce a hugh amount of red dust during the dry season and the farmer does not want the red dust drifting over his cotton. On the roads where traffic must continue to move, the farmer planted 150 feet of safrinha corn on either side of the road in an effort to shield the open bolls from the red dust. Keeping the cotton clean is an important factor in maintaining the quality.

Farmers in Mato Grosso have harvested 25% of their intended cotton, but they have already forward contracted 80% of their anticipated production. The demand for Brazilian cotton has outstripped the supply for three years in a row and it is expected to be repeated in 2018/19 as well.

Brazil is poised to surpass Australia as the third largest cotton exporter in the world and if the current trend for increased acreage continues for another year, it could surpass India next year as the second largest exporter, only surpassed by the United States.