2019 China state cotton reserves analysis

1. State cotton reserves review
From December 2 2019 to March 31, 2020, Chinese government has procured 371,560 tons of cotton into state warehouses, and trading prices averaged at 13,089yuan/mt. During the period, the reserves were suspended work on March 2, March 3 and March 23, and no cotton reserved for 19 trading days. In general, trading proportion was low before the Chinese Lunar New Year holiday as sellers were unwilling to sell with the positive outlook towards late market, but with the outbreak of novel coronavirus, cancellation in downstream orders and low cotton demand, sellers intended to sell cotton into state warehouses, leading to higher trading volumes.

The charts below show the reserving volumes, trading prices and trading volumes in Xinjiang and inland warehouses.