December 12, 2005

China's 2005 grain output may rise to over 480 million tonnes

China's grain output is likely to rise for a second consecutive year, the official Xinhua News Agency reported over the weekend, citing data from a government agency.

Grain output this year is expected to have jumped by more than 10 million tonnes to over 480 million tonnes, Xinhua reported, citing data from the National Development and Reform Commission.

However, the report did not provide a reason for the expected rise, nor did it give detailed estimates for each grain variety.

If realised, this would be the second rise after China's grain output fell to 431 million tonnes in 2003, the lowest in more than a decade due to years of smaller acreage and production.

However, declining stocks and climbing grain prices alarmed the government, which decided to encourage grain output by providing subsidies to grain farmers. The government's action resulted in China producing more than 469 million tonnes of grain in 2004.

Favourable weather also boosted the bumper crop last year.

The government, however, has yet to release official data for this year's grain production.

Xinhua reported similar estimates late September for the country's grain output, which were given by Chen Xiwen, a senior communist party official who is widely believed to have influenced China's agricultural policies in recent years.