China is about to open the floodgates on its huge supplies of cotton, sparking a rout in prices.

The country plans to auction about 2 million metric tons from May through August, a government statement showed Friday. That’s almost equal to total shipments expected this season from American growers, the worldΆs top exporters. The auction sales would represent about 14 percent of the 13.9-million tons that the U.S Department of Agriculture estimates that China has in its stockpiles.

Cotton futures fell the most in six weeks. The price slid more than 7 percent in the past year in part because the large Chinese inventories curbed overseas purchases from the Asian nation, the biggest consumer of the fiber.

“We knew this was coming, but itΆs probably a bit more than what people were expecting” and reduces the countryΆs import outlook in the near term, Keith Brown, president of brokerage Keith Brown & Co. in Moultrie, Georgia, said in a telephone interview.

Prices Slump

Cotton for July delivery fell 1.4 percent to settle at 60.02 cents a pound at 2:28 p.m. on ICE Futures U.S. in New York. Prices dropped as much as 2.8 percent, the biggest intraday decline since Feb. 29.

Adding to the outlook for bigger supplies is favorable growing weather in U.S. cotton areas. Rains in the next few days will boost soil moisture in Texas, the countryΆs top producer, according to MDA Weather Services in Gaithersburg, Maryland. Drier conditions will aid planting in the U.S. Southeast, the forecaster said. American farmers are expected to increase plantings in the season that starts in August as low prices for competing crops leave farmers with few options, the USDA projects.

“Any increase in production, as well as any volume pushed out of Chinese reserves, will be added to globally available supply in the coming crop year,” Cary, North-Carolina-based industry researcher Cotton Inc. said in a report this week. “High levels of available supply can be expected to keep downward pressure on prices.”

Still, the auction sales come as ChinaΆs crop is set to shrink this year to the lowest in more than a decade, USDA data show. ThatΆs reducing global output by more than 16 percent, the biggest annual slide since at least 1961. As the Asian country depletes inventories, in the “long-run itΆs positive,” for prices because it means that there will be less supply further down the road, boosting the outlook for eventual imports, Brown said.