Sales from China’s State Reserve remain strong with cumulative sales since the start of auctions on March 3 reaching over 10 million bales this week. About 30,000 tons have been offered for sale each business day with a base price calculated from the average of internal and world prices over the previous weeks. Daily sales rates have varied widely with much of the fluctuation due to buyers’ expectations of changes in the base price.

Sales have been split almost equally between cotton from the 2012 and 2013 crops, while sales from the 2011 crop account for only three per cent of the total. Purchasing has been evenly split between spinners and traders.

Demand has been strong for cotton from Xinjiang with over 99 per cent of its cotton offered being sold, amounting to just over 60 per cent of total sales. This is in stark contrast to cotton from the eastern provinces which, overall, has represented less than 40 per cent of the cotton sold. Furthermore, sales rates in the eastern provinces vary greatly. The determining factor for eastern sales appears to be the location of warehousing, while quality factors, such as length or color grade, are less influential.