China food security

 

China food security

Self-sufficiency in grains is a policy priority for the Chinese government, which wants to ensure the country can weather external uncertainty

Beijing is pushing for a breakthrough in biotechnology and seed production, while trying to ensure enough arable land is set aside for crops


In August 2020, a few weeks after stressing the importance of steady grain supply, Chinese President Xi Jinping made an unusual instruction for people not to waste food, which soon turned into a national campaign.

Since then, Beijing has ramped up its rhetoric around safeguarding food security. The issue has been thrown into the spotlight amid disruptions to the global agricultural supply chain caused by the coronavirus pandemic and heightened diplomatic tensions with the West.

Greater self-sufficiency in grains remains a policy priority for the government ahead of the 20th National People’s Congress to be held in the second half of the year.

Experts have warned that the Chinese agricultural sector is losing competitiveness to other major producers, with multiple weak links that need to be resolved.

We take a look at five areas concerning food security that have drawn attention in China.


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1. Declining domestic soybean and oil crop output

More than 80 per cent of the soybeans China consumes each year are imported. While imports have allowed land to be allocated for the production of other crops, notably staples like rice and wheat, the dependence on overseas soybeans has been long viewed as the Achilles’ heel in national food security.

The issue only gained more prominence during the trade war with the United States.

China’s domestic soybean output fell by 16.4 per cent in 2021, a much quicker drop than the 3.8 per cent decline in soybean import volumes, while planting acreage shrank by about 1.47 million hectares.

Planting more soybean and oil crops is a top agricultural priority for 2022, which Beijing hopes will lead to self-sufficiency in five to 10 years.

China’s agricultural ministry has unveiled a detailed to-do list, including turning some rice fields over to soybean production in northeastern provinces, trialling soybean production in saline-alkali land, and granting more subsidies for corn-soybean intercropping.

2. Weak influence in global supply chains

China imported a record 164.5 million tonnes of grain in 2021, up 18.1 per cent from a year earlier, official customs data showed.


The country’s food self-sufficiency rate has fallen to 76.8 per cent in 2020 from 101.8 per cent in 2000, a ratio that is expected to drop to 65 per cent by 2035, according to Du Ying, former deputy head of the National Development and Reform Commission.

Experts warn that Chinese agricultural companies have insufficient international influence and lack integrated strategies in overseas markets, which are dominated by the so-called ABCD quartet of grain traders – ADM, Bunge, Cargill and Louis Dreyfus.


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Du in January said China should improve its “going out” strategy and learn from the ABCD quartet about leveraging trade to gain influence in the global agricultural supply chain, especially for meat, milk, soybeans and corn.

He said special funds should be established to support Chinese companies’ overseas agricultural projects that are in line with national strategies.

But he warned against directly buying or leasing land overseas to grow grain because it would provoke “strong political and social sensitivities”.

3. The search for a seed industry breakthrough

Viewed by some policymakers as the “microchips” of agriculture, seeds are seen as an important area for an agriculture breakthrough, including commercial use of genetically modified (GM) soybeans and corn to boost grain security.

Xi has personally said the government must “advance the national seed industry” and boost self reliance in seed technology.

The government approved a plan to revitalise the seed industry in July last year and in November proposed an overhaul of regulations governing GM crops. The full-version of the revitalisation plan has not been made public.

China has already allowed some foreign-developed GM soybeans, corn, rapeseed, cotton and sugar beets to enter the domestic market, but only GM cotton and papaya have been commercially planted.


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4. Loss of fertile land

China has about one-fifth of the world’s population to feed, but only about 7 per cent of its arable land.

Sixteen years ago, Beijing set a “red line” to reserve at least 120 million hectares of arable land for agriculture.

But industrialisation and urbanisation has accelerated the loss of agricultural land since then. Land that was once cultivated has been left fallow, and cash crops are being favoured over cereals and legumes.



The state-run Economic Daily warned that China is at risk of falling below its red line in about 10 years, given the rate at which the national acreage has been shrinking.

It also said soil fertility in many regions was becoming increasingly poor.

The agriculture ministry wants another 6.66 million hectares of “high standard farmland” added this year, the same target as last year and roughly equal to the size of the Republic of Ireland.

5. Corruption and waste of strategic reserves

China has not revealed the overall size of grain reserves. The latest available data from 2019 showed that the storage capacity of China’s warehouses was 910 million tonnes in 2018.

The Central Commission for Discipline Inspection, China’s top anti-corruption body, has launched a special operation to crack down on alleged corruption in grain buying and sales around the country.

China wastes at least 35 million metric tonnes of grain every year due to poor storage and transport methods, as well as excessive processing.

Chinese lawmakers in March 2021 passed an anti-food waste law, which also stipulates stronger centralised management of grain storage and circulation to reduce losses.