Saturday, October 10, 2009

Grain Inventory Results: 225.4 mmt

In April 2009 the State Council ordered a nationwide check to find out the actual level of grain inventories. There were 10 government departments involved and thousands of provincial, prefecture, and county people involved. The check was carried out in response to rumors that warehouses supposedly filled with grain were actually empty.

The results show that at the end of March 2009 national state-owned grain enterprises held inventories of 450.8 billion jin (225.4 million metric tons in unmilled grain). This is in line with figures revealed previously. The inventory surpassed half of the 2008 harvest (roughly 6 months of consumption). The March date was presumably chosen because it precedes the summer grain harvest and inventories would be near their seasonal low.

This total appears to be central government reserves. There are also provincial and county-level reserves. It does not include private sector reserves (probably much smaller). Usually there are surveys of on-farm reserves conducted in April but I didn't see any this year. They usually report about 300-400 kg per farm on average, which could translate to 60-70 mmt of grain stored on-farm at the end of March.

Other results of the grain inventory check are vague. The mix of grains has become more reasonable and the regional distribution is improved. Accounts are 99.7% accurate, quality generally good, with a compliance rate of 97.1% and 99.1% of inventories are at their proper level. Management was generally good, but some unspecified problems were uncovered. A small amount of grain was poor in quality. Policies were carried out unevenly. Issues raised by each locality are being addressed through rectification work.

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