Sat, Feb 05, 2011 - Page 3 News List

Chinese leaders alarmed over effects of drought

NY Times News Service, HONG KONG

A severe drought in northern China has badly damaged the winter wheat crop and left the ground very dry for spring planting, fueling inflation and alarming China’s leaders.

Chinese President Hu Jintao (胡錦濤) and Prime Minister Wen Jiabao (溫家寶) separately toured drought-stricken regions this week and have called for “all-out efforts” to address the effects of water shortages on agriculture, state media reported on Thursday.

Wen made a similar trip just 10 days ago and called for long-term improvements in water management.

Rising food prices were a problem last autumn even before the drought began, prompting the government to impose a wide range of price controls in mid-November.

The winter wheat crop has been parched since then in northern China, while unusually widespread frost has hurt the vegetable crop in southern China. State media began warning a week ago that price controls on food might not be effective.

Some of the driest areas are close to Beijing, which has had no appreciable precipitation since Oct. 23, although there were brief snow flurries on Dec. 29. If the drought lasts another 11 days, it will match one in the winter of 1970 to 1971 as the longest since modern record keeping started in 1951, state media quoted government meteorologists as saying.

Particularly hard hit have been Hebei Province, which is next to Beijing and which Hu visited from Tuesday to Thursday, and southern Shandong Province to the east, which Wen visited on Wednesday and Thursday. The dirt in farmers’ fields has become bone dry and is easily lifted by breezes, coating trees and houses in fine dust.

RISING FOOD PRICES

Food prices have been rising around the world, a result of weather problems in many countries like the unusual heat wave in Russia last summer. High food prices have been among the many reasons for protests in Egypt and elsewhere in the Arab world.

However, even a prolonged drought in China appears highly unlikely to cause acute food shortages. China has spent years accumulating very large government reserves of grain and also has US$2.85 trillion in foreign-exchange reserves, giving it virtually unlimited ability to import food as long as major grain producers do not limit exports.

When commodity prices last surged in 2007 and 2008, however, at least 29 countries sharply curbed food exports in attempts to prevent domestic food prices from rising as quickly as world prices. And if China does become a large importer of wheat — it imports a lot of soybeans but tries to be essentially self-sufficient in rice and other grains for national security reasons — then it could push up world prices and make it harder for poor countries to afford food imports.

Gary Blumenthal, chief executive of World Perspectives, a Washington-based agriculture trade consulting company, said that wheat is grown in many countries and Chinese purchases would not necessarily result in a sustained jump in already high world prices.

“The wheat market can restore any imbalances more readily than perhaps other grains,” he said.

HARD TO REPLACE

China’s wheat imports rose to 893,700 tonnes in 2009 and 1.2 million tonnes last year from just 31,900 tonnes in 2008, according to figures from Global Trade Information Services, a data company in Columbia, South Carolina.

Those totals are small compared with global output that according to the Food and Agriculture Organization reached 682 million tonnes in 2009, the most recent year for which figures are available. However, China accounted for one-sixth of global wheat production that year, which could make a broad failure of the Chinese crop hard to replace immediately.

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