New minimum cotton prices – Mozambique

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New minimum cotton prices – Mozambique

7:41 CAT | 26 Oct 2016

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Mozambican cotton producers and buyers have fixed new minimum prices for raw cotton that are 38 per cent higher than those practiced in the 2016 cotton marketing season, which is now reaching its end.

According to a report in Tuesday’s issue of the Maputo daily “Noticias”, the Mozambican Cotton Association (AAM), which represents the companies that purchase raw cotton, and the National Forum of Cotton Producers (FONAP), meeting in the northern city of Nampula last Friday, raised the indicative minimum price of first grade cotton from 14.5 to 20 meticais (from 19 to 26 US cents, at current exchange rates) per kilo. For second grade cotton the increase is from 10.5 to 14.5 meticais.

The definitive minimum for the 2017 marketing campaign will be fixed in a further meeting to be held next April.

The chairperson of FONAP, Jose Domingos, said he believed the new prices will motivate farmers to grow more cotton. In the 2016 season there were companies who offered more than the minimum prices, and Domingos was optimistic that the same could happen in the coming season.

AAM representative Manuel Delgado regarded the indicative prices as “correct, prudent, balanced and motivating”. He believed they would contribute to the success of the campaign.

Luis Tomo, the general director of the government’s National Cotton Institute (IAM), who chaired the Nampula meeting, said the idea was to find a price that satisfied both the producers and the buyers. He said the meeting also discussed how to produce and distribute good quality seeds, which could led to increased cotton production and productivity.

The 2016 marketing campaign is expected to end with the sale of around 67,000 tonnes of raw cotton.

Source: AIM