South America Cotton Market

Cotton is the basic crop and the most consumed fiber in the South America region. The cotton crop is used as a cottonseed for animal feed purpose, cotton fiber for the textile industry, and as cottonseed oil in the food industry. Cotton, being a cash crop, is proving to be of great industrial importance. South America is the third largest producer of cotton in the world after Asia-Pacific and North America. Brazil dominates the cotton production in the region, with a significant presence in the global market.

Market Dynamics

Cotton is a perennial crop that grows perfectly in moderate rainfall and good soil conditions. Brazil is the sixth largest producer of cotton in the world and the largest producer in South America. In Brazil, 50% of the cotton produced comes from a rain-fed farm where water drawn in the soil is not a critical issue. The country produced 6.4 million tons of cotton in 2015-16, down 100,000 metric tons from the previous year. The total domestic consumption in the region has also decreased 100,000 metric tons from the preceding year as an impact of less production. Cotton production area has also decreased 40,000 hectares from the previous year as the farmers have shifted to other cash crops.

South America Cotton Market Segmentation

Brazil accounts for about 90% of the cotton produced in the region. However, Argentina accounts for only 218,000 metric tons of cotton produced. Brazil accounts for about 9% of the global export. This competitive presence of Brazil to the US and China came due to trade liberalization, structural transformation of the country’s economy, and the emergence of new cotton producing regions using advanced technology.

Key Players in the South American Cotton Market

The major suppliers of cotton in the region are Olam, Trade Prime, among others. These companies are actively participating in the entire value chain from sourcing, shipping, and logistics management to marketing and distribution, placing significant emphasis on the quality of the cotton.

The South American cotton crop market report covers the following information –

• Cotton production
• South American consumption
• South American trade (export-import) scenario and statistics
• Major enterprises and traders operating in the market
• Price trend and seasonality of the crop
• Future outlook of the crop market

Stakeholders who would benefit -

• Cotton growers
• Enterprises providing agricultural inputs
• Traders and companies operating in the segment
• Crop processing companies
• Crop importers and exporters
• Investors/research institutions interested in the crop market