Big changes underway in some markets raw material of agricultural origin. TO pay the price they are above all the United States and the reason, as often happens with products present in nature, are i climate changes. The first shock comes from cotton, a fairly valuable raw material, which for a year has been stable between 80 and 90 dollars per pound, but which in March 2022 had come close to 150 dollars and in 2011 reached its all-time high of 200 dollars. The news is that due to the drought and unprecedented scorching temperatures the Texas, that is, the American state where it is mainly produced, is in a phase of great difficulty and sees its dominant position threatened by Brazil.
Brazil and the USA are the largest cotton producers
USA and Brazil are the two today world's largest cotton producers, responding together to more than half of the global demand, but according to experts it is plausible that already in the 2023-24 season the absolute primacy will pass to the South American country, which according to estimates should export 11,25 million bales, while the North Americans are reviewing the initial forecast of 12,5 million bales was downgraded.
For the Use the current one should be there second worst collection ever, and moreover the quality of the cultivated cotton seems to be in great crisis, also due to the climate: Texas in fact recorded the second hottest summer in its history, with an average temperature of 29 degrees, and according to the Department of Agriculture only the '11% of the harvest is considered good or excellent quality. While the Brazilian one, thanks to the rains that occurred, was defined by the American Jack Scoville, vice-president of Price Futures Group, “of very good quality”.
Cotton is a fundamental material for the fashion industry
Il cotton it is a raw material fundamental for the fashion industry, which is the second largest globally with a total turnover of 2.400 billion dollars, providing employment to approximately 50 million people. For the US agri-food industry, however, this risks not being the only trauma. Russia and the European Union (putting together the various producing countries, starting with France) have already surpassed the stars and stripes giant for wheat exports: in particular, Moscow produces almost 90 million tons of wheat a year, and exports the goal. Not only that: always the Brazil this year is also about to blow to the States record of corn production and exports.
Brazil's advance in the agri-food sector
Recently the country was governed by Lula, who in agri-food field it always has great potential (for a decade it has also been the world leader in the production of the highly sought after soya), it has made progress especially in the field of logistics and distribution, intensifying port activity. Furthermore, he signed a new trade agreement with China, of which it is firmly the first trading partner especially in the exchange of raw materials, for which it has a secure outlet and is also benefiting from the unpredictable climate in the USA and the war in Ukraine, which was itself a large exporter of corn and also wheat . In Mato Grosso alone, for example, corn production has tripled in a decade to over 90 million tons, to the point that today the big issue in the South American country is that of storage. In 2023, according to official estimates, the Brazil will produce 130 million metric tons, the all-time record. Just as exports will reach an all-time high, for an expected total of 50 million metric tons. And unfortunately for the United States, Brazilian corn is much more competitive for China.
