Last week, the southwestern Chinese province of Sichuan, heavily reliant on聽hydropower, ordered many factories in 19 cities to shut or scale back production聽for six days to give priority to electricity supplies for homes.聽
The cuts, while limited so far, are聽hitting a number of global聽manufacturers. Foxconn Technology, one of Apple’s oldest suppliers, had to partially cease production at a聽plant. A Foxconn spokesman said the impact聽currently isn鈥檛 significant.

Toyota Motor Corp. and Volkswagen AG both said their plants in Sichuan had temporarily suspended operations. VW said it expected a slight delay on deliveries and believed they could be made up in the near future.

The aluminum producer, Henan Zhongfu Industrial Co., also said in a filing that its subsidiaries based in Sichuan will have to suspend production for a week. Additionally, fertilizer companies also reported hits to their output.

Some analysts worry that the drought and heat in China will damage the output of rice and corn crops for the fall harvest season in the country鈥檚 central regions and along the Yangtze River basin.

The impact of the drought and heat wave could lead Beijing to import more corn聽from Brazil or the U.S., said Darin Friedrichs, co-founder of Sitonia Consulting, a Shanghai-based agricultural research firm.

Source: WSJ