November 9, 2023

Extreme weather disrupting harvests in China's grains belt, impacting prices

Cold snaps are causing disruptions in the north-eastern region of China, affecting the harvesting of grains such as corn and causing fluctuations in prices, Yahoo! Finance reported.

The region, a crucial grains belt, has been grappling with extreme weather patterns throughout the year, including heavy rains and scorching temperatures, impacting agricultural production and quality.

This year's weather challenges pose a significant test to China's goal of achieving food security, especially considering its position as the world's largest importer of corn and soybeans. The latest hurdle comes in the form of heavy snowstorms hitting parts of Heilongjiang, Jilin, and Inner Mongolia this week, according to a report from the National Meteorological Centre on Monday.

As the harvesting season for corn and soybeans in the northeast nears its end, supplies are ready to enter the market. However, the cold snaps, bringing rain and snow, are affecting the logistics and sale of grains like corn. Farmers, anticipating stabilisation in prices, are holding off from sales, as reported by Holly Futures on Monday.

China's corn futures, traded on the Dalian Commodity Exchange, have rebounded since mid-October, reaching almost 1% to CNY 2,575 per tonne. Poor demand from the struggling livestock sector has previously exerted pressure on corn prices.

The impact of blizzards and strong winds is not limited to disrupting corn harvesting. The difficulty of harvesting rice in parts of Liaoning province is expected to increase, and there are concerns about potential damage to corn still in the drying process in certain areas of Jilin and Heilongjiang. Additionally, the agriculture ministry warned of potential damage to greenhouses and freezing of vegetables in an early growth stage.

-      Yahoo! Finance