March 2, 2004

China's Zhejiang Province To Increase Grain Reserve

The government of Zhejiang province in eastern China intends to increase its grain reserves by 500,000 metric tons in 2004, in an effort to secure adequate grain supplies, China's Ministry of Agriculture said Tuesday.
 
In a report on its Web site, MOA said the Zhejiang government will offer a direct subsidy of RMB 60-100 a ton to producers who sell grain to the government. Direct subsidies are a form of incentive payment above the market price to encourage farmers to sell to the government.
 
Major grain producing regions in southern and eastern China have stepped up procurement of grains from other producing regions, following an unexpected rally in grain and oilseeds prices late last year. The rally, in October, raised fears that China's grain supplies may have fallen to critically low levels.
 
China's grain production in 2003 fell 5.8% on year to an estimated 430.67 million tons, the lowest level since 1990, according to official statistics.