Drought Increases Chinese Wheat Demand

DROUGHT across five provinces responsible for more than half China's 100 million tonne wheat crop could trigger a major foray into global markets - including Australia - by a nation which prides itself on being largely self sufficient in wheat.

Shandong Province, which traditionally grows 20 per cent of China's wheat, is facing its worst drought in 200 years. In other areas the big dry is the worst in 60 years.

Chinese Government agency, Cofco, is understood to have already bought about 200,000 tonnes of feed wheat from Australia this year, while other grain purchases around the world have also begun.

Although a regular and significant importer of soybeans and some corn, China has been relatively self-sufficient in wheat for two decades, but now has about 6.75 million hectares of key wheat country in drought according to its Office of State Flood Control and Drought Relief.

The Chinese government is spending about $1 billion to boost emergency water supply and irrigation resources in drought areas.





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