An electrical pylon is reflected in floodwaters at a flooded corn farm in Zhuozhou, Hebei province, China. The flooding caused by the remnants of Typhoon Doksuri has damaged corn and rice crops in China’s northern grain-producing belt. Traders and analysts are concerned about the potential impact on global food inflation, especially with another typhoon approaching and more rain in the forecast. The extent of the damage to China’s cereal crops is still unknown, but it comes at a time when consumers worldwide are already facing tightening food supplies due to India’s ban on rice exports and disruptions in Black Sea grain shipments caused by the war in Ukraine. Experts predict that the flooded area in the north will experience yield losses, but the full extent of the damage will only be known once the floodwaters recede. Northern China, still dealing with the aftermath of Typhoon Doksuri, could see further crop damage with the arrival of tropical storm Khanun. Hebei province has already upgraded its emergency response to the highest level in preparation for potentially damaging downpours. Initial estimates suggest that 4-5 million metric tons of corn, about 2 percent of the country’s output, have been affected by the floods. However, it’s unclear how much of that will be completely lost or damaged. As a result, corn prices on the Dalian Commodities Exchange have fallen. In addition to corn, rice production is also likely to be reduced due to the floods. Analysts predict a 3-5% reduction in rice production in flood-affected areas. The heavy rain in China’s grain-producing region is expected to put upward pressure on global rice prices according to Fitch Ratings. Rice prices have already increased by more than 20% since India announced its ban on non-basmati white rice exports. While China’s corn imports are expected to reach an all-time high, analysts believe that the decline in rice production in the northeast won’t result in larger imports as the country is largely self-sufficient in rice.
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Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.
