Mumbai, 11 August (Commoditiescontrol): In the wake of substantial flooding, China's primary northern grain-producing belt has seen significant damage to its corn and rice crops, state traders and analysts. The already precarious situation may worsen as more rain is predicted due to another incoming typhoon. These developments pose a potential addition to global food inflation pressures.
This setback to China's cereal crops – the full magnitude of which remains uncertain – occurs at a time when global consumers are grappling with constricted food supplies. This comes on the heels of India's decision to halt rice exports last month and disruptions in Black Sea grain shipments due to the ongoing conflict in Ukraine.
As per trade analyst"The flooded region in the north is expected to suffer yield losses. Once the floodwaters retreat, we'll gain a more accurate understanding of the damage,"
Recent typhoons have not been kind to Northern China. The aftermath of Typhoon Doksuri, which hit just two weeks prior, is still being managed with swollen rivers and lingering floodwaters. Now, the region is bracing for potential further damage from the approaching tropical storm Khanun.
In anticipation of this new storm and in response to the previous week's historic flooding, China's northern Hebei province has escalated its emergency response to the highest tier.
Preliminary trade estimates indicate that the floods have impacted between 4 million to 5 million metric tons of corn, which approximates 2% of China's overall yield. However, the complete loss or damage is yet to be ascertained, as noted by another Singapore-based trader.
As per a senior analyst flood's repercussions on rice production in the northeast could amount to a 3%-5% reduction in affected areas.
The recent heavy rainfalls in China's grain-producing regions are anticipated to exert additional upward pressure on global rice prices, as per Fitch Ratings. It's notable that rice prices had already surged by over 20% following India's prohibition on non-basmati white rice exports.
Yet, there's a silver lining. The U.S. Department of Agriculture (USDA) projects that China's corn imports will peak at a record 23 million tons in the 2023/24 season, up from the previous year's 18 million tons. This spike might help offset the flood's impact on supplies.
Despite the dip in rice production, analysts don't foresee China increasing its rice imports, attributing this to the country's vast domestic rice reserves and its overall self-sufficiency.
(By CommoditiesControl Bureau; +91-9820130172)
0 Comments 
Post Comment 
