Drought hits hard in Henan China grain belt; crops hurt

Discussion in 'Wall St. News' started by lx008, Jun 13, 2024.

Will drought in Henan send global grain price higher ?

  1. sure

    1 vote(s)
    20.0%
  2. likely

    2 vote(s)
    40.0%
  3. unlikely

    1 vote(s)
    20.0%
  4. no

    1 vote(s)
    20.0%
  1. lx008

    lx008

    [​IMG]
    Local authorities in Puyang, Henan province, implement water-saving measures for irrigation. (Photo provided to chinadaily.com.cn)

    Henan province issued an orange alert for drought on Wednesday, as 72 national meteorological centers in 16 cities recorded severe heat for 10 consecutive days, the Henan Meteorological Center said.

    It is estimated that the drought will continue until June 20.

    The center advised local governments and authorities to take precautions, such as activating backup water resources, limiting water use for industries that consume large amounts of water and conducting atmospheric seeding operations to generate precipitation artificially.

    Yang Yajun, an official with the Henan Department of Agriculture and Rural Affairs, said that for the time being, water conservation measures are adequate for agricultural uses, but continued heat might have negative impact on the growth of crops.



    [​IMG]
    Local authorities in Puyang, Henan province, implement water-saving measures for irrigation. (Photo provided to chinadaily.com.cn)

    In Mengyin county of Shandong province, lack of rainfall has hurt crops, including fruit trees. It is estimated that yields will be reduced by 30 percent compared with last year, Beijing News reported.

    Local authorities in the county are taking measures to alleviate the drought and will attempt to make rain artificially when conditions permit.

    The meteorological centers in Henan and Hebei provinces renewed their highest red alerts for high temperatures on Wednesday.

    During the daytime on Wednesday, temperatures in regions such as Zhengzhou, Kaifeng, Xuchang and Luohe in Henan could rise to more than 40 C, forecasters said.

    The heat is expected to continue in the northern part of Luoyang, Zhengzhou, Kaifeng during the day on Thursday, with temperatures also rising to more than 40 C.

    Temperatures in Hebei's Baoding and Langfang cities, as well as in southern regions, may rise as high as 43 C during the daytime of Wednesday.



    China has a four-tier, color-coded weather warning system, with red representing the most severe conditions, followed by orange, yellow and blue.



    [​IMG]
    Local authorities in Puyang, Henan province, implement water-saving measures for irrigation. (Photo provided to chinadaily.com.cn)



    [​IMG]
    Local authorities in Puyang, Henan province, implement water-saving measures for irrigation. (Photo provided to chinadaily.com.cn)
     
  2. maxinger

    maxinger


    Don't worry.
    It is not a big crisis.
    The US has tons and tons and tons of
    corn, soya, and wheat for sale.
    Over the past 1 year, corn, soy, wheat ... prices have dropped by half.
    Why are food prices low?
    supply > demand.
    (Now who said there is inflation ?!?!?!?)

    Definitely if the US has a drought, then supply will be < demand.



    China can buy those grains from the US, or from South America.
     
  3. lx008

    lx008



    in a more interesting scenario

    US can also has some weather issues in the summer

    better keep watching
     
  4. schizo

    schizo

    China's not the only place being hit by drought. Fortunately, China is not a very big exporter of grains.
     
    murray t turtle likes this.
  5. lx008

    lx008


    it could turn into a big importer of grain

    if the drought stays there for longer
     
  6. upup_EA

    upup_EA

    I am a financial strategist, pay attention to the actual research of risk control management strategy, do not talk about lofty theory, only pursue in practice, the most pragmatic and feasible trading strategy, so the general conclusion of the "0.01 each time under the single" war method, for your reference. Over the years, I have repeatedly talked about it, but the response is few, and perhaps even fewer are willing to practice in the real plate. But I have broken the Guinness Book of Records in the financial world through this trading rule!!!

    Therefore, I basically do not consider the influence of the world situation and policies, because those are unstable factors. Only a fixed trading pattern can fix the profit and minimize the risk, which is proved enough by my breaking the record. I hope I can communicate with like-minded friends.
     
  7. lx008

    lx008

    Now it got some attention from Bloomberg
    China Grains Output Faces Drought Threat That May Stoke Imports - Bloomberg
    China Grains Output Faces Drought Threat That May Stoke Imports


    • Wheat, corn production forecast to fall by consultancy BOABC
    • Government expects bumper harvest in 2024-25 marketing year

    Drought is threatening China’s grains output, which may force it to re-enter the global market after staying away from major purchases in recent months due to oversupply and sluggish consumption.[​IMG]

    Wheat and corn production in the new season is forecast to fall, as drought in parts of northern China — a key grains hub — has reduced crop yields and delayed planting, according to BOABC, a Beijing-based agriculture consultancy.
     
  8. maxinger

    maxinger

    Bloomberg probably takes it as trivial news.

    The US grain futures price is around a record low.

    China can also buy wheat from Ukraine;
    just make some arrangements with Russia and China can get the
    Ukrainian wheat at an attractive price.
     
  9. lx008

    lx008




    indeed it's too early for analysts to estimate how much supply could be affected

    there could be more risk for corn and soybean than wheat

    as wheat in that area had been mostly harvested.
     
  10. lx008

    lx008


    China allocates 443 mln yuan to support drought prevention work | Reuters

    China's Ministry of Finance said on Tuesday it has allocated 443 million yuan ($61.1 million) for a disaster relief fund to support drought prevention work in seven provinces, including Hebei, Shanxi and Henan.

    Henan province grows about 25% of China’s wheat and 10% of China’s corn.

    The fund will be used for works such as watering, replanting and adding fertilizer in areas that are affected by recent heat and a lack of rainfall, it said.
     
    #10     Jun 18, 2024