Shashi is situated on the north bank of the Yangtze, and its cotton mills are supplied with raw cotton from the rich Jianghan Plain on which it stands. The city was the port for the ancient city of Jiangling and a distribution centre for produce from surrounding towns and Dongting Lake, which was trans-shipped mostly to Wuhan. The Sino-Japanese Treaty of 1895 opened the city to foreign trade, Japanese engaged in the cotton-seed trade formed the majority of the resident foreigners, though this community was never large.