GIEWS Country Brief: China 30-June-2020



  • Production of 2020 wheat crop forecast at near‑average level

  • Cereal import requirements in 2019/20 forecast at below‑average level

  • Prices of rice and wheat remained generally stable since beginning of 2020

  • African Swine Fever outbreak severely affected pig industry in 2018 and 2019

Production of 2020 wheat crop forecast at near‑average level

Harvesting of the 2020 main winter wheat crop is ongoing and was completed at the end of June, while harvesting of the spring wheat crop will take place in July and August. Since the beginning of the cropping season in September, precipitation amounts and irrigation water availability have been near the average in most main producing areas. In the northern parts of the country, snow coverage during the winter months has been adequate to protect crops from winterkill and boosted soil moisture during the critical spring months. Localized damages to standing wheat crops were reported in Henan and Hubei provinces, due to below‑average rains in April and a cold spell in late spring. The 2020 wheat production is preliminarily forecast at 134 million tonnes, close to the average level.

Harvesting of the 2020 early double rice crop just started, while the single and late double crops, for harvest between September and November, are currently being planted. Overall, the area sown is forecast to stabilize, after contractions registered in 2018 and 2019, as the Government approved, for the first time in six years, an increase in Government purchase prices for Indica paddy.

Planting of the 2020 maize crop was completed in April in the South and will continue until the end of June in the North, where the bulk of the production is concentrated. The planted area is estimated close to the five‑year average, mainly driven by Government support measures. Overall, production prospects are favourable as weather conditions were near the average and supported crop development in the main producing areas. According to official information, some concerns remain due to the potential widespread impact of Fall Armyworm (FAW) infestations.

Cereal import requirements in 2019/20 forecast at below‑average level

Total cereal import requirements in the 2019/20 marketing year are forecast at 18.8 million tonnes, about 20 percent below the five‑year average.

Imports of rice in 2020 calendar year are forecast at 2.6 million tonnes, about 33 percent below the previous year’s level, on account of the ample availabilities from the 2019 paddy harvest and large carryover stocks. Imports of wheat in the 2019/20 marketing year (July/June) are forecast at 3.5 million tonnes, close to the five‑year average, due to ample domestic availabilities from large inventories. Among imports of coarse grains in the 2019/20 marketing year (October/September), imports of maize are forecast at 3.5 million tonnes, slightly above the five‑year average, reflecting strong demand from the feed industry. By contrast, imports of barley and sorghum are forecast at 5.5 and 2.5 million tonnes, about 20 and 40 percent, respectively, below the five‑year average. The expected sharp decline of barley and sorghum imports reflects their substitution by maize for feed use.

Prices of rice and wheat remained generally stable since beginning of 2020

Prices of Indica and Japonica rice were generally stable from January to April 2020 and decreased marginally in May, reflecting adequate market availabilities. Overall, prices of rice in May were below their year earlier levels.

Prices of wheat and wheat flour have been generally stable since the beginning of the year, mainly due to large supplies from the 2019 bumper output and favourable expectations of the 2020 wheat harvest.

African Swine Fever outbreak severely affected pig industry in 2018 and 2019

The country, which is the largest producer and consumer of pork meat in the world, has been severely affected by several African Swine Fever (ASF) outbreaks in 2018 and 2019. In an effort to contain the spread of the disease, the Ministry of Agriculture and Rural Affairs has reported that about 1.2 million pigs were culled since the outbreak started in August 2018. Animal losses due to the ASF has caused substantial reduction of farmers’ income, raising concerns over the livelihood activities and the food security situation of millions of people dependent on pig farming. Small‑scale hog farmers, who rely on the production of pig meat for their own consumption as well as for income generation, are among the most affected as they usually lack the expertise and/or the financial resources necessary to protect their herds from the disease. In the country, about 130 million households are engaged in pig farming and about 30 percent of the national pig output is produced by small-scale producers.

COVID‑19 and measures adopted by the Government

In an attempt to prevent the spread of the COVID‑19 pandemic, the Government adopted several measures, including large‑scale mobility restrictions at national level, social distancing and closure of educational institutions. Starting from mid‑February 2020, the Government has gradually removed mobility and activity restrictions, prioritizing the essential sectors and industries that are important for the national economy. As of late May 2020, social distancing remains in place in parts of the country, micro‑level and international travel remains restricted.

In May 2020, the Government announced the implementation of several packages to support the national economy. These include a CNY 4.2 trillion (USD 594 billion) support package for:

  • Epidemic prevention and control, including production of medical equipment.

  • Disbursement of unemployed insurance, also to migrant workers.

  • Tax relief and waived social security contributions.

The People’s Bank of China has been providing monetary support of CNY 1.8 trillion (USD 255 billion) at low interest rates to micro, small and medium enterprises producing essential products and services for the daily necessities and to the agricultural sector.

The Government has also taken measures to provide financial relief to the affected households, businesses and regions facing difficulties to repay loans. The main measures include:

  • Encouragement of lending to Small and Medium Enterprises (SMEs), including uncollateralized SME loans from the local banks.

  • The delay of loan repayments, with the deadline extended to the end of March 2021, and easing of loan size restrictions for online loans and other credit support measures for eligible SMEs and households.

  • The encouragement of lending of higher Non‑Performing Loans (NPL) and reduced NPL provision coverage requirements.