The Chinese government is to begin building up the country's cotton reserves again in a move designed to stabilise domestic cotton production and help avoid fluctuations in cotton prices.

The cotton purchasing and reserve programme will run for seven months from 1 September until the end of March next year. During this time the government will step in to buy standard cotton at CNY19,800 ($3,099) per tonne if local market prices fell below this level for five consecutive days.

Purchases will be conducted by the National Cotton Reserves Corporation under plans drawn up by the National Development and Reform Commission, according to the state-run Xinhua news agency, and will apply to 13 cotton producing areas in China.

China is the world's top cotton producer, consumer and importer.