USDA attache ups Brazil 2003/04 cotton crop estimate

The US Agriculture Department's attache in Brasilia released the following report, dated May 11, on the cotton outlook for Brazil.
Post raised 2003/04 lint cotton production to 1.25 million tons and area to 1.0 million hectares. Exports were lowered to 225,000 tons and imports to 100,000 tons. Production in 2004/05 is forecast at a record 1.5 million tons on 1.25 million hectares. Post forecasts exports at 500,000 tons and imports at 100,000 tons.
PRODUCTION: Cotton production in 2003/04 is forecast to reach a record 1.25 million tons on 1.0 million hectares. Strong profit prospects induced producers to increase area 265,000 hectares over the previous year.
Mato Grosso and Bahia led the charge with area in the two states expanding by approximately 200,000 hectares. Post forecasts total production in 2004/05 at 1.5 million tons on 1.25 million hectares as producers continue to expand area due to high expected profits. Bahia should be the leading state in rate of area and production expansion with new areas in western Bahia being brought into cotton production.
Mato Grosso will continue as the leading production state and expansion is again expected to be significant.
Post forecasts 2003/04 exports at 225,000 tons, more than double that of last year. However, this forecast is lower than earlier in the year as shipping logistics have restrained exports. Shipments in 2004/05 are forecast at a record 500,000 tons as abundant domestic supplies and limited internal consumption will allow exports with many contracts already signed for exports to Asia from the 2004/05 crop.
Imports in 2003/04 are forecast at 100,000 tons with the US accounting for 71 percent of shipments to date. Imports in 2004/05 are also forecast at 100,000 tons with continued demand for lower-grade and Pima cotton.
Post forecasts of total Brazilian cotton production for 2003/04 at 1.25 million tons on 1 million hectares, which is up roughly 45 percent and 40 percent respectively over last year. This production forecast is slightly higher than CONAB's forecast of 1.24 million tons as Post forecasts minimally higher production in Bahia and Mato Grosso, though late rains may impact yields slightly.
Most cotton producers in Mato Grosso and Bahia, where about 65 percent of the national crop is produced, also plant soybeans. Soybean rust infestation in Bahia and Mato Grosso last year combined with strong cotton prices at cotton planting encouraged producers to increase cotton area with area in Bahia alone estimated over 100 percent larger than last year.
Weather during this growing season in the Center-West region has been satisfactory overall, though excessive rain in Mato Grosso has minimally impacted the crop and lack of rain has lowered yields in Parana and Sao Paulo.
Though the majority of the crop has not yet been harvested, yields at this stage are not likely to be greatly affected by adverse weather.