The drought in North China from late last year to early this year is quite likely to impact the wheat production in China in 2011, casting a cloud over the food security for China. And prices of grains such as rice, corn, wheat have witnessed huge increase for a long time and may continue to increase in the future, pushing up CPI in China.
To safeguard the grain production, the government plans to strengthen its support for seed industry, hoping this can contribute more to grain production increase in China. On 22 Feb., China approved “Suggestions for Accelerating Development of Modern Crop Seed Industry”, aiming to foster some leading seed companies with strong sales network and R&D capability to provide adequate improved varieties for farmers.
Besides, Ministry of Agriculture released a notice recently which requires agriculture departments at all levels universalize GM crops knowledge, reflecting government's determination to further push on GM crops in China.
With the support from China’s government, domestic seed industry may witness great development in the coming years, generating many opportunities for both domestic and overseas companies. For instance, Longping Hi-Tech plans to cooperate with Limagrain to set up a joint venture for the development of corn seed, wheat seed and its other seed business. Yihai Kerry, a leading agribusiness and food company in China, has entered China’s seed industry by acquiring shares of some domestic seed companies or founding joint ventures.