May 27, 2011

The lingering drought devastating middle and lower reaches of China's Yangtze River since May is expected to affect agricultural production in some regions and this may push up prices of farm products, analysts say.

Market generally holds that the drought will have a direct impact on freshwater aquaculture as well as rapeseed production, adding that the related agricultural products are predicted to go up in the near term and the agriculture section on the stock market will benefit from the rise.

Statistics show that the drought has affected nearly two million hectares of farmland in Hubei, Hunan and Jiangxi provinces, accounting for about one third of the country's total drought-hit arable land.

China's longest river, the Yangtze River, has been plagued by a severe drought, with the lowest level of rainfall since 1961. The spring drought has affected Jiangxi, Hunan and Hubei provinces in the middle and lower reaches of the Yangtze River, with 40-60% less rainfall on average.

Meanwhile, Chinese Vice Premier Hui Liangyu has called for intensified efforts by local government leaders, agricultural experts and farmers to ensure that China will reap another bumper harvest of grain this year, during a two-day inspection tour in north China's Hebei province.