MUMBAI (Commoditiescontrol) - China has sold only 3.7 percent of cotton offered from its state reserves after more than a month of daily sales, with poor demand for expensive state cotton. In the week ending August 14, total cotton sold 48,218 tons.
Beijing was aiming to sell as much as 1 million tons of fibre from state stocks by the end of August, as part of a plan to gradually reduce its bulging reserves.
But with some commercial inventory still available in the market and the state auction prices relatively high, mills have held back from bidding.
Mills were mainly interested in the cheapest crop, the 2011 domestic cotton, buying just over 40,000 tons to date. None of the 2012 domestic cotton has been sold, and only 7,753 tons of imported fibre has been sold.
Industry observers say at the current pace of sales, the reserve will sell less than 100,000 tons, limiting the amount it could purchase in the new crop season starting in October.
China has a reserve stockpile of 11 million tons of cotton, around half of the world's stocks.
(By Commoditiescontrol Bureau; +91-22-40015532)