China starts selling state-owned cotton reserves

According to the China National Cotton Reserves Corporation, the government will begin selling cotton stocks on 10 July as it had announced. It nonetheless remains to be seen how much demand there will be for these stocks. 

The prices which the Chinese government is charging for its cotton stocks are considerably higher than the prices on the Chinese market. The cotton price has fallen by nearly 3% since the start of the month, and is currently trading only marginally below the 66 US cents per pound mark. Furthermore, the downward pull of the Chinese equity market - which had been observed until yesterday - is likely to have a negative impact on cotton prices, says Commerzbank.