Cotton marketing experts have been arguing about the quality of the cotton in China’s reserves for three years. Now they may be about to find out just how good – or how bad it is.

A few days ago the China National Development and Reform Commission or NRCD announced they would begin selling a portion of China’s estimated 58 million bales of reserve stocks beginning in early May.

According to the NRCD, 2 million metric tons (the equivalent of about 9 million 480-pound bales) will be offered for sale in 2016. Only a set amount can be purchased daily, apparently to avoid giving the appearance China is dumping cotton on the market.

Whether China will be any more successful in this year’s auction than last year’s – when almost no cotton was sold – remains to be seen, according to Jody Campiche, the National Cotton Council’s vice president for economic services. She talked about Chinese cotton developments in a presentation to the American Cotton Producers meeting in Birmingham, Ala.“The difference in this auction compared to last year’s is they’re expected to release a larger amount of their reserves,” Dr. Campiche said. “And they are supposed to use a price that is driven by the domestic and world markets. So we’re expecting the price to be more competitive compared to last year when they were able to auction off only a small amount.”

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