On lowering, after being detached from the halyard, the national flag is
folded in the following fashion:
Held by the hoist and the fly, it is folded in half lengthwise, so that the part
where the lone star Spica [above the motto--Ed.] and the scroll with Ordem e progresso are
facing the ground;
Still held by the hoist and the fly, it is again folded in half
lengthwise, leaving visible upwards the side with the point of one of the
wide angles of the yellow lozenge; the side with the scroll must be toward the
troops in formation;
Next it is folded along the width three times, the hoist and the fly edges [being
folded under] to touch the cloth from below, approximately at the opposite edges
of the blue disc, with the side showing the lone star and scroll remaining upward;
After folding, the National Flag shows most of the scroll turned upward;
it is put over the bent arms of the senior men, that being the position for carrying it;
For storage, one more lengthwise fold may be made, the blue field remaining upward.
Source: Presidential decree 4447, 29 October 2002, Ceremonial Code of the Brazilian Navy,
section 2-2-16
Reported by Joseph McMillan, translated by António Martins-Tuválkin, 21 August 2003
If I understand correctly, the end result of the folding is to have
the motto on the center of the celestial sphere showing, along with
the single star that appears above it. Joseph McMillan, 20 August 2003