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Posted by Daniel Workman Jul 4, 2007 |
While China grows the most wheat, much of its grain crops are used to feed the Chinese people. Major international trade exporters of wheat include the United States, Canada and Australia.
According to a short press release in the Toronto Star on July 3, China expects to raise its wheat production 2.2% to 107 million tonnes this year. Many Chinese farmers are planting more grain instead of more labour-intensive crops.
China's above average wheat harvest may result in the People's Republic shipping more Chinese wheat exports particularly to neighbouring Asian countries.
With wheat prices around a record US$6.50 per bushel, expect wheat farmers in competitive trading nations to complain about China dumping more of its grains onto the world market at prices subsidized, at least in part, by China's unusually low currency exchange rate.
Wheat farmers in Canada, Australia and the U.S. now have to concern themselves not only with wheat harvests in their homelands, but also in international trade's leading wheat arena - China.