Brazilian cotton growers seek $372 million in aid
Brazil Cotton Growers Seek $372 Million Aid to Support Prices
Brazilian cotton producers urged the government to spend 800 million reais ($372 million) in subsidies to support cotton prices as a global slowdown cuts consumption and prices, an industry official said .
Growers asked the Agriculture Ministry to ensure they receive 44.6 reais per arroba, or 1.35 real per pound, said Sergio de Marco, the head of a cotton association that includes growers and government officials. The subsidy would be enough to cover about 65 percent of Brazil’s total cotton crop, he said.
Cotton growers are seeking assistance as prices for the commodity trade at about 1.17 real a pound, 13 percent below the minimum price for government purchases and lower than production costs, de Marco said today in a telephone interview from Sao Paulo.
“The government signaled it will help the sector, but we still don’t know how much it will offer,” de Marco said after attending an event with Agriculture Minister Reinhold Stephanes.
Brazilian cotton growers this year cut by 21 percent the amount of land planted for the commodity and may reduce it further if prices stay down and the government fails to intervene, said Haroldo Cunha, the head of Brazilian Cotton Association.
“ Growers are migrating from cotton to soybeans seeking higher yields,” Cunha said in a telephone interview from Sao Paulo.
De Marco said he expects the government to hold three auctions for cotton growers starting in May.
Brazil is the fifth -biggest cotton producer and the fourth-biggest exporter.
Brazilian cotton growers seek $ 372 million aid
Due to the decline in consumption and price due to economic slowdown, Brazilian cotton producers urge the government to allocate 800 million Leial (about $ 372 million) subsidies to support cotton prices, an official said.
Growers are asking the agriculture ministry to ensure they receive a subsidy of 44.6 per arova, or 1.35 reais per pound, said Sergio de Marco, president of the Brazilian Cotton Association, which includes growers and government officials. . He said the subsidy would cover about 65% of Brazil’s total cotton production.
Cotton growers are asking for help because cotton is trading at about 1.17 reais per pound, 13% below the low price purchased by the government and below the cost of production, De Marco said in a television interview in Sao Paulo today.
“The government has hinted that it will help the sector, but we still don’t know how much it will provide,” De Marco said at an event with Agriculture Secretary Reinhold Stephanes.
Brazilian cotton growers have reduced their planting area by 21 percent this year. If cotton prices fall further and the government does not intervene, cotton merchants may further reduce their planting area, Haroldo Cunha, president of the Brazilian Cotton Association, said.
“Cotton growers are now switching to soybeans in search of higher returns,” Cunha said in a telephone interview from Sao Paulo.
DeMarco expects the government to hold three major auctions for cotton growers starting in May. Brazil is the fifth largest cotton producer and the fourth largest cotton exporter.
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