China’s main wheat crop may emerge mostly unscathed from a dire drought as Beijing moves to fund last-minute irrigation, reviving crops that might otherwise have been left to die by farmers struggling with low prices and oversupply.
A domestic media outcry and public hand-wringing about the severity of the drought triggered some speculation that the world’s biggest wheat producer might resort to imports, but experts say fears over the impact of the drought – which officials have called the worst in half a century – are misplaced and overblown.
Beijing has declared an emergency over the drought in parts of northern China that lie between Beijing and the Yangtze River, which have seen little snow or rain since November. Among the areas hardest hit is China’s biggest wheat-producing province, Henan, which grows a quarter of the crop.
The drought area covers almost half of China’s winter wheat fields, but only a fraction have suffered real damage so far. Much potential damage could be prevented if farmers irrigate their fields in time, researchers said. The Agriculture Ministry said on Feb. 5 half the affected fields had been irrigated.
“If all the measures are implemented, we will be able to keep losses to within 2.5 per cent” of the total harvest, said Xiao Ziniu, an official at China Meteorological Administration.
A forecast for rain across much of the area this weekend should help, although too little is expected to end the drought.
Even so, President Hu Jintao has ordered “all-out efforts to combat the severe drought” and the government has mobilized millions of farmers to water their dry fields by offering subsidies and sending experts to help drought relief, which should minimize the impact on seedlings.
That could keep losses to less than three million tonnes, pulling overall production back from last year’s record 112.5 million tonnes towards 2007 levels. That might prompt some sales from China’s swollen granaries, but would be unlikely to spill over into calls for large imports from the international market.
While farmers are not yet in the clear – the damage could get worse if crops are starved of water during their critical growing phase in March and April – China also has a sizable supply cushion should the damage spread.
Last year China exported only 126,000 tonnes before the government suspended exports, concerned about a spike in global prices that could have drained its stocks. To prevent a glut and pressure on farm incomes, the state bought up 43 million tonnes of wheat, adding extra reserves to existing stockpiles.
“Even in the worst-case scenario, the government, with 60 million tonnes of wheat stocks, has the ability to ensure supplies and control prices,” said Ma Wenfeng, an analyst with Beijing Orient Agribusiness Consult Ltd.