March 8, 2011 

 
Fears of wheat crisis in China recede

 

 

Rain and snow during the past two weeks, together with a huge irrigation effort, appear to have saved much of the wheat crop in northern China from drought, Chinese and international agricultural and meteorological experts said on Monday (Mar 7).

 

This winter was the driest in perhaps 200 years in parts of China, the world's largest wheat producer. That prompted alarm a month ago that China might need to sharply increase its usually modest wheat imports, at a time when world food prices were already surging. Supplies were tight after bad weather in other wheat-producing countries, including Russia and Australia.

 

But days of snow and rain across the heart of China's wheat belt in northern Henan and western Shandong Provinces have brought moisture to fields so dry that large cracks appeared in the dirt. The precipitation arrived at just the right moment, experts said, as vulnerable wheat planted last autumn was coming out of its winter dormancy and needed to grow or it would die.

 

"Things look better, definitely, and the government seems to be in control with irrigation and providing a lot of assistance to farmers," said Kisan Gunjal, an official at the UN FAO in Rome.

 

Chen Xiwen, the Chinese Communist Party's director of rural policy, said on Sunday (Mar 6) that three rounds of precipitation and extra irrigation efforts had left less than a third of China's wheat acreage still suffering from drought.

 

A good wheat harvest could help China control inflation. Prime Minister Wen Jiabao said that price stability was a top priority for China this year.

 

Winter in China's wheat belt is usually fairly dry. But this winter was so dry that it provoked considerable concern, from government offices in Beijing to the grain markets of Chicago.

 

President Hu Jintao and Wen separately toured parched wheat fields during the Lunar New Year holidays and urged emergency irrigation and other efforts. The UN food agency issued a rare special alert on February 8, warning of the drought's effects on the wheat crop and even on drinking water for people and livestock.

 

Wheat futures in CBOT, already high because of extreme heat in Russia last summer, surged even higher when the food agency issued its alert, jumping 2% in a day. On Monday (Mar 7), wheat futures edged down 31.5 cents, or 3.8%, after word spread of China's recent damp weather.

 

China has been planning to send more trade delegations to the US this year to look for imports to help balance its enormous exports and persistent trade surpluses. But grain experts said that it would be hard to discern quickly whether China was buying more wheat from the US.

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