Monday, April 22, 2013

More Corn Planting Despite Lower Price in 2013

China's National Bureau of Statistics first-quarter macroeconomic report says the bureau's survey of 90,000 farmers' planting intentions indicate a continuation of recent year's trends: more corn, less soybeans and cotton. Corn area is expected to go up another 4.1 percent, while soybean area is expected to plunge again by 8.5 percent. Cotton area is also expected to fall 6.2 percent.

China farmer planting intentions, 2013
Crop Percent change
Rice 1.0
Corn 4.1
Soybeans -8.5
Cotton -6.2
Source: National Bureau of Statistics survey.

Corn area's increase comes despite a decline in corn prices in the first quarter of 2013. Most prices were up from a year ago, but corn prices during the first quarter of 2013 were down 2.1 percent from 2012. Rice prices were up 7.1 percent and rice was up 5.5 percent. Hog prices were also down this year from their high level in early 2012. Other livestock prices were also up sharply. Pork output was up 2.8 percent from last year.

In China's investment-driven economy there's not much investment in agriculture, so agriculture's share of the  economy is shrinking fast. Agricultural (primary industry) GDP (at constant prices) was up 3.4 percent during the first quarter of 2013, less than half the rate of overall GDP growth of 7.7 percent.  Fixed asset investment was up 20.9 percent, but the agricultural sector accounted for just 1.6 percent of it (this doesn't include investment by rural households but they generally don't invest much in agriculture). Output of "above scale" industrial firms was up 9.5 percent, almost three times the growth rate for agriculture.

China agricultural price changes, first quarter, 2013
Commodity Percent change from last year

Wheat  7.1
Rice  5.5
Corn -2.1
Oilseeds  3.5
Sugar -1.2
Vegetables  4.1
Fruit  2.8
Tea leaf -0.5
Hogs -3.1
Cattle  16.3
Sheep   9.0
Poultry   7.5
Eggs  10.8
Source: National Bureau of Statistics.

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