China’s production of major grains may rise in 2008 due to higher yields, despite a reduction in planted area, the China National Grain and Oils Information Center (CNGOIC) said on Monday.

China's corn plantings are estimated at 27.4 million hectares (67.7 million acres) in 2008, down 2.32% from 28.05 million hectares a year earlier, as farmers shift land to soybeans due to higher profits, according to a report issued by the grain think tank.

However, corn output may rise 0.7% on year to 149 million metric tons due to a 3.1% increase in yield to 5,438 kg./hectare (86.6 bu./acre), the CNGOIC said.

The center said in its updated report issued later Monday that wheat area in 2008 would remain unchanged from 23 million hectares last year, while output in the new crop year would rise 1.5% to 107.6 million tons on a 2.4% yield increase.

Winter wheat output, which makes up most of China’s total production, is seen growing 1.3% to 102.6 million tons.

"This year is a normal year for winter wheat and the yield will increase by 2-7%," Mao Liuxi, a senior researcher with the China Meteorological Center, told a conference in Beijing.

Still, a drought that has become the worst in decades is affecting China's eastern Shandong and northern Hebei provinces, two major wheat-growing regions, Mao said.

State media reported that as of March 26, drought conditions had affected 19.4 million hectares (48 million acres) of arable land, mainly in northern China, including 3.3 million hectares of cropland.

CNGOIC also forecast a 0.14% fall in rice area to 29.19 million hectares, but a 0.38% rise in output to 187.2 million tons – also helped by a slight rise in yield.

Meanwhile, the total output of major oilseeds varieties will be higher this year due to increased acreage.

China's soybean plantings are expected to reach 9.5 million hectares in 2008, up 9.2% from 8.7 million hectares a year ago, it said in the revised report.

Soybean output is likely to reach 16.5 million tons in the new crop year, up 22.22% from 13.5 million tons last year, it said.

China's rapeseed plants in 2008 are expected to be 7.28 million hectares, up 12.38% on year, while total output is likely to reach 12 million tons – the same as last year – the report said.

Editor’s note: Richard Brock, The Corn And Soybean Digest's Marketing Editor, is president of Brock Associates, a farm market advisory firm, and publisher of The Brock Report.