According to a forecast by the All-China Federation of Supply and Marketing Cooperatives the cotton stockpiles in China is expected to fall to 1.74 million tons by September this year, the lowest level in the past five years.

Shi Jianwei, head of the cotton and hemp division of the federation, set this year''s cotton supply at 8.2 million tons, but domestic cotton demand only stands at around 6.46 million tons.

China produced 4.92 million tons of cotton last year.

Xinjiang Uygur Autonomous Region is a leading base for production of quality cotton in China, so many Chinese textile companies have been operating outlets for buying cotton directly from this remote region. There were 706 businesses engaged in cotton purchasing in Xinjiang.