China's crops badly damaged by icy storms: AgMin

Reuters 30 Jan 08;

BEIJING (Reuters) - China's Agriculture Ministry said on Wednesday that the unusually harsh winter had dealt a serious blow to the country's wheat and vegetable crops and warned that damage could rise because of persistent cold.

The ministry said in a statement on its Web site that 103 million mu of farm crops had been hurt by the freak weather, which has plagued southern, central and eastern China over the past week.

Of that total, it said 11 million mu had been ruined, while another 53 million mu were badly damaged.

The crops affected included rapeseed, vegetables, wheat, tangerines and tea leaves, although the ministry did not specify how much of each had been damaged.

Beijing is sending out experts to the most damaged areas: Hunan, Guizhou, Hubei, Anhui, Shaanxi, Henan, Jiangxi and Jiangsu.

"They will survey the damage and lead rescue work, to guide these areas to resume winter production as quickly as possible and ensure efficient market supply of farm products," it said.

Grains traders and industry officials were most nervous about damages to rapeseed, an oilseed grown mainly along the Yangtse River that is harvested after March.

While record vegetable oil prices have raised the country's rapeseed acreages this year by possibly as much as 30 percent from a year earlier, any crop loss would lead to higher imports of edible oils or oilseeds, including soybeans.

"The most important thing to watch out for is the local rapeseed crop," said a trader at an international house in Shanghai.

"This year, if the weather is normal, the crop should be around 11 million. If bad weather continues in the next 1-2 weeks, we'll have to cut our forecast."

A small 2007 rapeseed crop, which some traders estimated at 8-9 million metric tons -- or well below the government think-tank estimate of 12 million -- has helped push up the country's imports of soybeans and vegetable oils last year.

The Shanghai trader added that so far China had booked 6-7 cargoes of canola, or rapeseed from Canada, for December to February shipment at $570-620 per metric ton, including costs and freights.

The traders and industry officials said though the icy weather would reduce the country's 2007 winter wheat crop, they expected the damages to be small. It was also unlikely to lead to any supply shortages due to its ample stocks in the grain.

"I do not have great concern about wheat supply at this moment," said one industry official in Beijing. "The Chinese government has enough wheat stocks."

He said the top wheat producing in the north, such as Shandong, Hunan, Hebei should be fine, though damages might be done in less crucial producers such as Jiangsu, Anhui and Hubei.

"According to weather department forecasts, rain and snow is persisting in most southern areas and some are still experiencing snow storms, so the disaster may continue to develop," the National Development and Reform Commission said in a statement.

The NDRC said in a separate statement that prices of some vegetables, including cabbage, carrots, eggplant and cucumbers, have risen by more than 50 percent in some regions because of the storms.

(Reporting by Simon Rabinovitch and Nao Nakanishi in Hong Kong; editing by Dominic Whiting)

The Big Freeze
Tracy Quek, Straits Times 31 Jan 08;

Half million troops battle snow chaos
Harsh Chinese winter deals blow to crops and factory output; exports likely to suffer

IN BEIJING - CHINA, in disaster-relief mode, yesterday dispatched half-a-million army troops and twice that number of police to do battle with the snow chaos in blizzard-hit regions.

Soldiers shovelled snow off icy roads and distributed cotton quilts and coats. Military helicopters ran rescue missions and 14,000 medical personnel fanned out to tend to the injured and sick.

Chinese Premier Wen Jiabao yesterday continued his mission to shore up the morale of frustrated rail passengers, travelling from Changsha in central Hunan province to southern Guangzhou city, where several hundred thousand travellers remain stranded.

But even as Beijing boosts efforts to alleviate the people's frustration and suffering and restore transport links, fears are growing over the extent of the economic fallout from the worst winter to hit southern China in decades.

Some believe the effects will be felt long after the skies clear.

The big freeze has struck 17 of China's 31 provinces and provincial-level regions. Some of the worst-hit areas include the country's farming heartlands where freezing temperatures are a rarity.

Underscoring the freakish nature of the cold spell, the country's north, where harsh winters are common, is enjoying clear weather.

Beijing, for example, is experiencing sunshine and blue skies.

The unexpected winter has dealt a serious blow to wheat and vegetable crops, drastically reducing yields, said the Agriculture Ministry. Deliveries of fresh food have also been disrupted because of highway and rail closures.

All this is resulting in shortages that are driving up food prices, and complicating the government's efforts to rein in inflation, which is already at an 11-year high.

Vegetable prices have spiked in 11 provinces due to the weather, more than doubling in some areas, as trucks have been unable to deliver their loads, officials said.

The supply crunch and price increases come at the worst possible time, just days before the Chinese New Year holiday, when millions return to their home towns for celebrations and feasting.

Heavy industry and the manufacturing sector, the backbone of China's blistering economic growth in recent decades, have also been hit by power outages and transport delays due to snow.

Factories including steel makers and auto plants have had to cut back on or halt production. The drag on domestic production could affect exports, a major driver of the economy, in the coming months.

Beijing will have its hands full dealing with the slowdown in exports, as well as repairing the extensive damage inflicted by blizzards on infrastructure, say observers.

Since the onset of the blizzards on Jan 10, economic losses from damage to property and farmland have hit 22 billion yuan (S$4 billion), according to the Ministry of Civil Affairs. Losses are expected to snowball with the winter storms forecast to continue.

All this could mean a less spectacular economic start to the new year.

Meanwhile, the death toll from weather-related accidents has risen to 55.

Speaking to the crowds at Guangzhou's train station yesterday, Premier Wen sought to give them hope, saying trains would be up and running soon.

'Currently every level of government is working on getting electricity restored, after that transport will resume,' he said.