Tuesday, February 8, 2011

China drought threatens to 'devaste' wheat yields

by Agrimoney.com

The world's biggest wheat crop – China's – faces a "critical situation" if a drought across most of its range does not break, the United Nations has said, warning that cold temperatures could also "devastate yields".
The UN's food agency warned that "substantially-below normal" rainfall over the last four months, , had put some 5.2m hectares of winter wheat, an area significantly bigger than Denmark, at risk of drought damage.
By lowering snow cover, the conditions had also left the crop vulnerable to damage from low temperatures during the rest of the winter.
"Thus the ongoing drought is potentially a serious problem," the UN Food and Agriculture Organisation said in a so-called "early warning" alert.
"Adverse weather, particularly extreme cold temperatures, could still devastate yields.
"The situation could become critical is a spring drought follows the winter one, and/or the temperatures in February fall below normal."

'Serious risk' 
The warning adds China to the list of countries, including Canada, Kazakhstan and Russia, whose wheat crops have suffered severe weather setbacks in recent months, while America's hard red winter wheat seedlings have also suffered from a lack of rain and snow.
Macquarie on Tuesday cautioned of a "serious risk of damage" to the US hard red winter crop from temperatures which are expected once again to fall below the -10 degrees Fahrenheit deemed a danger level by Kansas State University.
Last week, Barclays Capital warned that a "significant" drop in Chinese wheat production "could propel international prices strongly higher".
However, while Chicago's benchmark March wheat contract showed some recovery following the FAO alert, it remained in negative territory as of 14:00 GMT, down 0.7% at $8.53 a bushel

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