In Bahia, production could experience an estimated fall of more than 200,000 bales in 2008/09. Most of the decline in cotton production is attributed to shift in area from cotton to other commodities production in the 2008/09 crop year.Brazil’s cotton consumption to remain strong in 2008/09 as the economy expands: .Brazil’s 2008/09 cotton consumption is projected at a record 4.6 million bales, up 2.2 percent from the estimated consumption in 2006/07 and 2007/08. The increase in mill use is due in part to rising domestic consumer demand for apparel and textiles.The International Monetary Fund (IMF) forecasts a strong albeit declining Brazilian economy in 2009. Gross domestic product (GDP) in 2009 is expected to grow 3.7 percent, down significantly from the previous year when the economy grew at 4.8 percent. Strong economic growth and growing concerns over domestic inflation led the Brazilian Central Bank to hike the basis overnight interest rate by 0.50 points to 11.75 percent in March 2008. This increase in interest rate is expected to tighten credit availability which has implications for both mill use and consumer spending on apparel and textiles.Source: United States Department of Agriculture
Date:6/14/2008
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