China Extends Power Curbs Amid Heat Wave, Drought

In the Sichuan provincial capital of Chengdu, a major manufacturing base, auto makers and components suppliers reported lower production because of the power constraints.

Further east, in central China’s sprawling metropolis of Chongqing, home to more than 30 million people, shopping malls were told they could only open on Monday between 4 p.m. and 9 p.m. due to the power rationing, CCTV cited the local government as saying.

The combination of drought and heat wave is particularly acute because it is leading to high electricity demand as residents need air conditioning to stay cool. At the same time, there is less total power available as the lack of rain dents supply from hydropower dams that are crucial to the region.

Rainfall in July for the Yangtze River basin was down 40% from a year earlier. The river is a key source of water for hydropower production as well as for transportation. Levels for some parts of the river have been at their lowest points since records began, China’s Ministry of Water Resources said last week.

The power rationing is undercutting industrial production, exacerbating the damage caused to China’s economy by the government’s stringent Covid-19 control measures. China is one of several countries in the Northern Hemisphere that are facing droughts, a phenomenon that is challenging global supply chains and risks driving up food and energy costs.  

General Interface Solution, a Taiwanese maker of touch sensors and display components for electronics, said in a regulatory filing that its subsidiary in Chengdu had extended a suspension of production in accordance with the local government’s contingency plans.

Apple Inc.,

which had previously named the company as one of its suppliers, didn’t respond to a request for comment.

Foxconn Technology Group,

one of the biggest suppliers to Apple, has also been hit by power rationing. The company’s production in Chengdu was continuing to run at a low level on Monday, said people familiar with the matter, although it was up slightly from last week. The people said Foxconn was in talks with the local government to gradually increase production later this week.

A Foxconn spokesman said the current impact on production wasn’t significant.

Meanwhile, the suspension at

Volkswagen AG’s

plant in Chengdu continued on Monday, a spokeswoman said, adding that the company expects to make up for any delays with increased production in the future.

Toyota Motor Corp.

, which last week suspended production at its Chengdu plant, has conducted a test run on its production lines with its own power generator, a spokesman said. The plant wasn’t operating at normal levels, he added.

Tesla Inc.

appealed to the Shanghai government for help ensuring that its suppliers in the region received sufficient power. In a letter to the Sichuan government viewed by The Wall Street Journal, Shanghai officials reported that Tesla had said it faced shortages of components as suppliers in Sichuan were unable to produce at full capacity due to the power cuts.

The high temperatures have extended across much of southern China. The country’s meteorological administration said that 65 weather stations registered record temperatures. The heat advisory was listed as a “red alert,” its highest level, while the state forecaster put the drought warning at its second-highest level of orange.

The heat has also sparked wildfires. More than 5,000 firefighters, police and other personnel have been called in to battle blazes that ignited late last week south of Chongqing’s downtown. Authorities said the fires had been extinguished by Monday morning, but they would be on alert against the risk of the fires reigniting for at least the next three days.

Droughts have been increasing worldwide since the beginning of the century due to land degradation and the effects of climate change, according to the United Nations. The high temperatures and low rainfall experienced across southern China are raising particular concerns for grain production, especially that of water-dependent rice.

Tang Renjian, China’s minister of agriculture and rural affairs, said in certain drought-stricken areas the government should seek to artificially increase rainfall while also spraying crops with a water-retaining agent to help prevent evaporation, according to a ministry press release over the weekend.

“While we believe most weather-related disruption should be short-lived, higher risk persists on grain supply, in our view, followed by aluminum given its highest energy intensity, should the drought and weaker hydropower extend,” Goldman Sachs analysts said in a note Sunday. The six provinces particularly affected by the drought and heat wave produced 48% of China’s rice in 2021, the note said.

—Selina Cheng and Qianwei Zhang contributed to this article.

Write to Brian Spegele at brian.spegele@wsj.com and Yang Jie at jie.yang@wsj.com