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China Wheat Output Falls 0.9% After Rain Damage Ahead of Harvest

BEIJING, July 15 (Reuters) – China’s summer wheat output fell 0.9% this year, official data showed on Saturday, the first decline in seven years after heavy rain hit key growing areas just ahead of the harvest.

Output in the world’s top grower of the grain fell to 134.53 million metric tons, the National Bureau of Statistics said, although it added that this year still brought a bumper harvest.

Wheat acreage increased by 0.4% but yields were down 1.3%, the statistics bureau said.

The output drop is expected to have at most a minor impact on China’s plentiful state stocks, said Huang Tian, an analyst at SDIC Essence Futures.

The stocks would also likely forestall any significant impact on domestic food prices, although lower production could drive up imports by one of the world’s top buyers at a time of uncertain global supplies.

The global wheat market is closely watching dry weather in key exporters Canada and the United States, and the looming expiry of Ukraine’s wartime shipping deal on Monday.

The decline was largely attributed to weeks of heavy rain that battered mature wheat in the country’s top growing province of Henan and surrounding areas just before the harvest.

“Large-scale rainfall occurred in the northern wheat region in late May, which lasted for a long time, had a large volume, and affected a wide range of areas, resulting in insufficient sunlight during the grain filling period and a decrease in grain weight,” the statistics bureau said in a statement.

In Henan, which produces about one-third of the country’s wheat, the rain caused wheat to germinate in some areas, and the yield “dropped significantly”, it added.

Beijing has urged local reserves to buy up some of the damaged grain but purchases have been slow so far, and wheat prices have fallen significantly in recent weeks in Henan .

Drought during the latest winter and spring in Southwest China has also reduced summer grain yields in Yunnan and Guizhou provinces and other areas, the bureau said.

Source : Reuters