Brazilian Growers Seek $372 Million USD in Cotton Subsidies
May 7, 2009 
By Katia Cortes
Bloomberg
Brazilian cotton producers urged the government to spend 800 million reais ($372 million) in subsidies to support cotton prices as a global slowdown cuts consumption and prices, an industry official said.
Growers asked the Agriculture Ministry to ensure they receive 44.6 reais per arroba, or 1.35 real per pound, said Sergio de Marco, the head of a cotton association that includes growers and government officials. The subsidy would be enough to cover about 65% of Brazil’s total cotton crop, he said.
Cotton growers are seeking assistance as prices for the commodity trade at about 1.17 real a pound, 13% below the minimum price for government purchases and lower than production costs, de Marco said today in a telephone interview from Sao Paulo.
“The government signaled it will help the sector, but we still don’t know how much it will offer,” de Marco said after attending an event with Agriculture Minister Reinhold Stephanes.
Brazilian cotton growers this year cut by 21% the amount of land planted for the commodity and may reduce it further if prices stay down and the government fails to intervene, said Haroldo Cunha, the head of Brazilian Cotton Association.
“Growers are migrating from cotton to soybeans seeking higher yields,” Cunha said in a telephone interview from Sao Paulo.
De Marco said he expects the government to hold three auctions for cotton growers starting in May.
Brazil is the fifth-biggest cotton producer and the fourth-biggest exporter.
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