Maputo — Mozambican cotton producers earned 386.9 million meticais (about 16.1 million US dollars at current exchange rates) from the sale of first grade raw cotton in the 2007 harvest, the government's Mozambique Cotton Institute (IAM) reported on Saturday.

First grade cotton accounts for 80 per cent of the crop sold in Mozambique. The minimum price was 5.3 meticais (22 US cents) a kilo, but most of the purchasing companies paid more than the minimum. Some of the peasant producers, organised into associations, were able to obtain premiums of between seven and 13 per cent in negotiations with the companies.

The IAM puts the probable earnings from exporting 27,000 tonnes of cotton fibre at 27 million dollars (assuming an average export price of 1,000 dollars a tonne). So far only 2,124 tonnes has been exported, bringing the country 2.3 million dollars.

The IAM added that there are still stocks of 19.673 tonnes of cotton fibre awaiting export during the first quarter of 2008 - or perhaps later if the companies decide to wait for the international price to rise.

The cotton ginning also resulted in 40,000 tonnes of cotton seed, which is expected to be sold for 2.4 million dollars (at a price of 60 dollars a tonne).

The price of cotton seeds has been rising, due to their potential use in biofuels.