Plunging prices and changing tastes mean Chinese grain farmers are having to think carefully about what they plant this year. “No more corn, that’s for sure. It doesn’t make money. And wheat is risky as it depends on purchases at set prices by local authorities,” said Wang Cuifen, who farms 200 hectares in Shandong Province. Wang has reduced her wheat crops by 27 hectares this year…Full Article: Xinhua Mar 2016

Key Points

  • From 2015 to 2016, according to Shandong’s Department of Agriculture, the province has decreased its wheat cultivation area by 8,333 hectares, the first such decline in eight years. A farmer in Shandong Province also noted that local farmers will cut corn production and are “desperate” for corn varieties that producer higher yield and higher quality corn.
  • According to the Director of Hunan’s Grain Bureau, local government granaries have no room to store purchased crops in 2016.

ChinaAg Comments

  • From 2015 to 2016, China’s Ministry of Agriculture hopes to decrease its corn cultivation area by 670,000 hectares.
  • As of 2015, China’s northeast (e.g. Heilongjiang, Liaoning, Jilin and Inner Mongolia) had approximately 160 million MTs of corn in storage, or roughly 78% of China’s total corn reserves.
  • In November 2015, China announced plans to cut its corn production by 3.3 million hectares across 13 provinces/regions by the end of 2020. This decline in area will cut production by approximately 25 million MTs. According the Deputy Director of China’s Crop Production Department (under the auspices of the Ministry of Agriculture), the major corn producing regions of Liaoning, Jilin and Heilongjiang will see the largest declines in production area, while Shanxi, Shaanxi, Gansu, Guizhou and Yunnan will also be affected somewhat.
  • In September 2015, China decreased its corn purchasing price for state reserves by 10.7%, marking it the first decline since price support measures would introduced in 2008.
  • From 2003 to 2013, corn production in China’s northeast (e.g. provinces of Heilongjiang, Liaoning, and Jilin) increased from 6.3 million ha to 11 million ha.
  • From 2012 to 2013, Chinese corn production increased from 205 million MTs to 218 MTs. In 2013, Heilongjiang produced 32 million MTs of corn, accounting for 15% of China’s total output. Jilin produced 27 million MTs or roughly 13% of the country’s corn output.

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