November 11, 2013
China''s corn harvest declines due to floods, drought
After flooding in its biggest-producing province and drought in its fifth largest cut yields, China''s corn harvest is poised to decline for the first time in four years, easing a global glut as the US reaps a record crop.
China''s corn output fell 3.2% to 199.1 million tonnes, according to Société Générale de Surveillance (SGS SA). The state-owned China National Grain & Oils Information Centre expects a 4.6% advance to 215 million tonnes and a unit of the USDA projects a 2.1% gain to 210 million tonnes.
Smaller harvests and benchmark prices that slumped 50% from the record set in 2012 signal Chinese buyers will import the maximum 7.2 million tonnes allowed by annual government quotas. Futures have tumbled to a three-year low, curbing income for farmers from Brazil to Ukraine while lowering costs for Tyson Foods Inc. and other poultry producers.
Geneva-based SGS estimated that Chinese farmers planted 35.3 million hectares (87 million acres) of corn, 0.7% more than a year ago. That compares with 39.4 million hectares in the US SGS used five teams of two surveyors to conduct face-to- face interviews with farmers in central-north and northeast China. Its estimated margin of error is 5.7%.
The output in Heilongjiang province in China''s northeast, the biggest growing region, contracted 5.7% because of flooding while water damage in Shandong cut output by 22%, according to SGS. A severe mid-season drought in Henan reduced its crop by almost 15%, SGS said. Production in Jilin rose 13% while in Liaoning it climbed 9.2%.
SGS said that excessive rainfall was cited as the cause of bad weather in 52% of cases, from 19% a year earlier. Reports of severe insect damage increased by 10 percentage points to 23% of the total. Reports of crops severely damaged by disease rose to 6% from 4%.
The average yield across the survey area was 5.65 tonnes a hectare, 3.8% less than last year''s official government data, according to SGS. The average yield for this year''s US crop was forecast at 9.75 tonnes by the USDA in September. More than half of Chinese corn farms are holdings of one hectare or less and tended by the landowner, according to SGS.