China may become top wheat importer

wheat sxcChina may soon become the world’s top wheat importer with the country’s wheat crop suffering more damage than previously thought, with frost in the growing period and rain during the harvest

A Reuter’s report has claimed that farmers and estimates from analysts have revealed weather damage in China’s northern grain belt could have made as much as 20mn tonnes of the wheat crop, or 16 per cent, unfit for human consumption. The estimate is double the volume previously reported as damaged.

Higher imports, which have already been revised upwards on initial damage reports, will further shrink global supplies and support prices, fueling new worries over global food security.

The US Department of Agriculture has raised its forecast for China’s imports in 2013/14 to 8.5mn tonnes from 3.2mn tonnes in the previous year, prompting US wheat prices to rally to more than two-week highs.

Competition from China for more imports would force other buyers, such as Egypt, to pay more for grains.

In China's top wheat producing province of Henan, farmers visited by Reuters said kernels shrunk because of the frost early this year followed by more damage with grains germinating due to the rainstorms in May. Henan is in the northern grain belt, which accounts for about half of China's output.

China had already booked around three million tonnes of wheat for shipment in the year to June 2014, nearing last year’s purchases.



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