U.S. economist say China may import more wheat

by Emily Wilson
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After peaking at 16 million tonnes in 1991, China's imports of wheat from all sources have declined precipitously, but that trend may be reversed this year, according to an agricultural economist at Kansas State University.

Smaller crops in the past two years along with continued high levels of domestic consumption have pushed Chinese wheat stocks to 14.8 million tonnes, the lowest level since 1973-74, noted William Tierney, KSU economist and grain marketing specialist, in a recent market report. That stocks level represents only 13% of annual use, a situation that could point to increased imports, he said. Conditions for China's 2001-2002 winter wheat crop remain mostly good based on favorable weather during the fall and early winter. The winter wheat crop accounts for about 90% of the country's total wheat crop. China's spring wheat crop tends to be of low quality with little market demand.

Starting in 2000, the government no longer purchased wheat at above market prices, and farmers have shifted more of their area to other crops. It's been estimated that the area planted for the 2001 winter wheat crop declined 5% to 7%, and 2001 spring wheat area is expected to decrease as well.

This is the fourth year of lower wheat seeded area brought about because of increases in production costs, particularly for irrigation water; higher prices for alternative crops such as rapeseed; and a shift in government policies, which have reduced the incentive to produce low-quality wheat. One Chinese government agency has projected the 2001-02 total wheat crop will be 105 million tonnes.