- Commodities
Extreme weather conditions threaten crops
Do you want to know how to make money from this?
Register for free and get expert advice, access to a training course and webinars.
Key points:
- The predicted drought in the Black Sea region and part of the United States may lead to a reduction in sunflower and corn yields.
- This will negatively impact global food supplies, causing prices to rise.
- Drought is negatively impacting the sowing and growth of corn in China, the largest importer of this crop.
Due to the predicted drought in the Black Sea region, sunflower and corn harvests are likely to be reduced. A similar situation is developing in the United States, where heavy rains that replace abnormal heat can lead to damage to crops. This, in turn, will negatively impact global food supplies, causing prices to rise.
Threat to the harvest
The impact of climate change is becoming increasingly felt, leading to extreme weather events such as record high temperatures and drought in key crop-growing regions. This negatively affects sowing work and already developing crops.
Vast areas of Russia, China, India and parts of the United States are facing extremely hot weather and precipitation deficits. For example, in the USA, another major food exporter, extreme heat gripped parts of the east coast. That prompted the government to downgrade its estimates for corn and soybeans on Monday.
At the same time, heavy rainfall in the key Midwest region and forecasts for further increases in humidity have raised fears of flooding in some areas.
Weather conditions in Asia
Heavy rainfall is forecast in some dry regions of Asia, which could bring relief to producers. Rainfall in China, the world’s largest soybean importer, is expected to help ease the effects of the drought. India, the world’s largest rice exporter, is also forecast to see a recovery in monsoon rains, which are now 20% below normal. This will be an incentive for the development of agriculture in the country.
Previously, corn and soybean production in China’s northern and eastern regions were negatively impacted by dry weather. However, forecasts for the period from July to September are more optimistic: normal weather is expected with precipitation slightly above normal, which will have a beneficial effect on the condition of agricultural crops.
Australia is also forecast to have normal weather, with some regions seeing above average rainfall, improving wheat crop forecasts. Argentina and Brazil are also expected to experience mostly favorable weather conditions in the coming months.
Severe drought forces Chinese farmers to delay corn planting
China, the world’s largest corn importer, hit record production last year, harvesting 288.8 million metric tons. In order to ensure food security, the country strives to further increase production volumes, but this is hampered by climatic difficulties.
This week, China’s Ministry of Agriculture reported the negative impact of drought on planting and growth of new crops. 443 million yuan ($61.1 million) was allocated to combat drought in seven provinces. These funds will be used for irrigation, plant replanting and fertilization.
Lower grain production in the world’s largest grain importer will likely lead to increased purchases from exporters such as Brazil, the United States and Argentina. This, in turn, could become a catalyst for rising world food prices and inflation.
It is worth noting that the seven drought-affected provinces account for about 35% of China’s corn production. However, some regions with irrigation systems will most likely be able to avoid serious damage.
Do you want to know
How to make money from the news
Register for free and get:
- Expert consultation;
- Access to the training course;
- Opportunity to participate in webinars