Ammonium sulfate (SAM) leads to the cost of cotton drop
Cost of cotton production for the 23/24 harvest in Mato Grosso， Brazil dropped 1.60% in April compared to March.
The production cost reported by the Profitability Project showed a 1.60% decrease in the cost of cotton production for the 2023/24 harvest in April 2023 compared to March 2023, totalling R$ 10,572.54/ha.
This reduction was mainly driven by a 3.53% decrease in expenses related to macronutrients, due to lower demand for the products and the devaluation of the dollar, which put pressure on macronutrient prices.
Considering the decrease in input prices, the exchange ratio (RT) between the monthly price of cotton fibre and the available price of ammonium sulfate (SAM), the main fertilizer used in the crop, decreased by 10.01% in April 2023 compared to March 2023. Currently, it takes 16.99 arrobas of cotton fiber to acquire one ton of the product.
Finally, it is important to highlight that the price drops in cotton fibre may impact the exchange ratio in the coming months.
