China’s Food Security

Posted by on Feb 14, 2013 in Blog | 0 comments

There are many alarmists who warn of a global food crisis should China actively procure grains on the international market.  Others accuse China of land grabs in Africa and other continents for food production at the expense of the locals.  This article by Katherine Morton of the Australia National University sets the record straight.

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  The policy debate on China and food security tends to be rather neo-Malthusian.
The overriding concern is that China’s population will demand more food than international markets can supply. Some commentators worry that competition over food may become a trigger for international conflicts — there are plenty of pessimistic forecasts predicting future food wars and clashes over scarce agricultural commodities. What these alarmist accounts fail to consider is that the Chinese want to be self-sufficient. That desire has led to a domestic policy of independence that acts as a safeguard against price volatility and means the burden of supplying the Chinese market does not fall heavily on international markets. But can China’s policy of self-reliance endure?

Contrary to some reports, Chinese domestic demand was not a major cause of the global food crisis in 2007–08. China was not dependent on imports, which meant that it was shielded from the destabilising effects of market fluctuations. In other words, at the time China had enough food in stock to absorb the international price rise. China currently holds the world’s largest grain reserves (70 per cent of which are wheat or rice), which have a storage capacity estimated to be around 200 million tonnes, or roughly 30 to 40 per cent of total domestic grain production. For eight consecutive years China has enjoyed bumper harvests of over 500 million tonnes of grain per year, largely on account of technological advances. But while China produces nearly enough grain to feed its population by itself, it cannot feed its livestock. And since the Chinese will eat more protein as they grow wealthier, producing enough grain to feed animals as well as people poses a major challenge.

China has always been preoccupied with feeding its own population. For many Chinese, the real economic miracle achieved over the past three decades of ‘opening and reform’ is the fact that China has managed to feed roughly 21 per cent of the world’s population on only 9 per cent of the world’s arable land. The government has taken notice of volatility in food prices in recent years and it is determined to support domestic production. China’s political leadership is especially concerned about this issue because exposure to price volatility in international markets could lead to social unrest and political instability.

For the complete article, visit: http://www.businessspectator.com.au/bs.nsf/Article/China-food-security-farm-purchase-development-pd20130214-4VVMR?opendocument&src=rss

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