August 4, 2008

China's Yunnan inks agreements to secure grain supply

China's southwestern Yunnan Province has inked dynamic grain reserve cooperation agreements with other provinces in the nation in a bid to guarantee its grain supply.

It signed the agreements with the northeastern Jilin Province, central south Hunan Province, and northeastern Heilongjiang Province in May, June, and July, with a total of 60 million kilogramsme, 20 million kilogrammes, and 20 million kilogrammes, respectively.

The agreement stipulates that Yunnan would take precedence over other provinces in buying these grains at market prices if grain supplies within the province cannot meet demand.

The cost of the 100 million kilogrammes of grains, if the purchase was effected, would far exceed the RMB 30 million the province spent last year.

Although the province has a strong agricultural focus, it mainly exports tobacco, which makes up a big part of the provincial GDP. Other agricultural products include coffee, tea, mushrooms, dairy and horticultural products.