Dry reality of droughts in China

From times immemorial, China has faced droughts, with some parts of the country facing the curse every two to three years. The damage droughts have inflicted on China's socioeconomic fabric was relative to their intensity and duration. For instance, the drought in 1994-95 was so intense that it caused a loss of $13.8 billion.

South and Southeast China suffered severe droughts in 2010-11. Now Henan province and the Inner Mongolia autonomous region and Northeast China are in the grip of a severe drought. Shaanxi, Hebei, Shanxi, Gansu and Anhui provinces too have been affected by drought to different degrees. This dry spell is likely to reduce China's corn production this year to less than 200 metric tons, the lowest since 2009.

The current spell of drought could have serious repercussions. Grain prices on the Dalian Commodity Exchange have already increased, which will affect government policies to keep food prices low and seriously complicate its efforts to limit cheaper grain imports to ensure food sufficiency and security.