the world’s top cotton consumer, will auction an initial volume of 1 million tonnes of cotton from its 10 million reserves during July and August, said the country’s top economic planner on Tuesday, according to media reports. Beijing will offer 330,000 tonnes of domestic cotton from the 2011 crop with a floor price of 13,200 yuan ($2154) per tonne, 470,000 tonnes of domestic cotton from 2012 at 14,200 yuan ($2317) per tonne, and 200,000 tonnes of imported cotton from the 2012 crop at 15,500 yuan ($2530) per tonne. The announcement from the National Development and Reform Commission confirms estimates of volumes and prices that have been circulating in the market for weeks. China’s cotton stockpile auction is expected to shake up the international market and depress both price and demand. “Small farmers hoping to sell their crops in the international market will not be able to compete with these prices,” said Anup Singh, global product manager, Fairtrade International. Market rumours had swirled for weeks that Beijing was preparing to release some of its holdings under a now-abandoned state buying scheme to support farmers. Global cotton prices have been tracking around five-year lows for the past 10 months, under pressure from weak demand and large stocks.
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