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China’s cold winter hurting wheat crop

Jan. 7, 2013, China - The coldest winter in 28 years in China, the world's largest wheat producer, may hamper the developing winter crop, according the official China National Grain and Oils Information Center (CNGOIC).

Southern China will be hit by a new cold front this week, with temperatures dropping to as low as minus 5 degrees Celsius on Jan. 11 and 12, according to the China Meteorological Administration. Guizhou and Hunan provinces may experience snowstorms, it said.

Widespread snowfall and lower temperatures since Jan. 2 have affected crops in southern growing regions and along the Huai River, CNGOIC said in an e-mailed report, without giving an estimate on crop damage. Winter wheat usually accounts for about 90 percent of the country's output, according to Ma Wenfeng, a grains analyst at Beijing Orient Agribusiness Consultant Ltd.

"So far the general growing condition in the winter-wheat areas remains good and snowfalls are usually beneficial for wheat," Masaid by phone today. "But a drought coupled with low temperatures will hamper growth."

Two people died and 770,000 people have been affected by record-low temperatures and snow in Inner Mongolia in northern China, Xinhua said yesterday, citing the local government. More than 260,000 people are in need of emergency aid and about 180,000 head of livestock have died, according to the report.

Wheat futures traded in Zhengzhou gained 0.8 percent to 2,592 yuan ($416) a metric ton at 2:24 p.m. in Shanghai, and jumped 13 percent in 2012. The grain in Chicago rose 0.8 percent to $7.53 a bushel after climbing 19 percent last year.

"Last year China by and large had a pretty good wheat harvest as we estimated output of 117 million tons," Ma said, adding that government data showed a record 120 million tons.

China will produce 120.6 million tons in the 2012-2013 season, the U.S. Department of Agriculture estimated in December.

January 7, 2013  By Bloomberg