Heat wave threatens power shortages and higher pork prices in China
As many as 84 cities across the country on Wednesday issued their highest-level red alert warnings — which means temperatures are expected to reach over 40 degrees Celsius (104 Fahrenheit) in the coming 24 hours — according to the National Meteorological Administration. Shanghai reported 40 degrees Celsius on Sunday for the first time this year.
China’s heat wave has pushed electricity demand to extreme levels in many regions as people turn up the air conditioning.
On Tuesday, Zhejiang province — a major export and manufacturing powerhouse on the east coast — urged its 65 million residents and businesses to save power.
“In order to ensure electricity supply for residents and companies …we call for the joint actions by the whole of society to save electricity,” the province’s energy bureau and the State Grid said in a joint statement.
Zhejiang’s energy bureau has also rationed supply of power for some energy-intensive firms, such as polyester producers and textile printing and dying companies in the cities of Hangzhou, Shaoxing, and Haining, according to analysts from several Chinese brokerage firms.
High temperatures are also hitting China’s crop production, threatening to push up food inflation.
The Central Meteorological Observatory has warned that high temperature could adversely impact the production of corn, soybean, wheat, and pastures in many northern provinces, such as Ningxia, Inner Mongolia, and Hebei.
Earlier this month, a number of major feed producers, including New Hope Group, warned clients that they would increase prices of pig, poultry and fish feeds because of rising cost of soybean meal, corn and wheat. Most of the price hikes kicked in last week.
Pork, the staple meat in China, has been particularly badly affected, as soybean and corn are the main ingredients used in the pig industry.
By the week ending July 1, hog prices had increased 46% since March, according to the most recent data from the National Development and Reform Commission, the country’s top economic planner.
— CNN’s Jessie Yeung and Shawn Deng contributed to the reporting.