January 25, 2005

China '2005 grain prices may rise slightly -statistics dept

China's grain prices may rise moderately in 2005 as demand still outstrips supply despite a significant grain output increase in 2004, National Statistics Bureau Chief Li Deshui said Tuesday.

In a press conference held by the State Council, China's cabinet, Li said grain output this year may rise, but at a lower pace than in 2004.

Li didn't elaborate.

China's 2004 grain output rose by about 24 million metric tons to more than 455 million tons due to larger acreage and favorable weather, the first increase after a five-year decline.

However, the country's annual demand is estimated at more than 490 million tons, leaving a gap of about 35 million tons, which needs to be filled by reserves or imports.

China doesn't disclose its grain reserve numbers.

The country imported more than 8 million tons of grains in 2004, sharply higher than the 681,174 tons in 2003.