China will push for greater self-reliance in food
President Xi has spoken of a food security "crisis" as long-term and chronic threats grow
China's government insists that it faces a major food security challenge, despite impressive output increases and bumper harvests. President Xi Jinping last year called for "a sense of crisis about food security”. Behind such statements lies an awareness of environmental threats and natural disasters, a shrinking and ageing farm labour force, shortages of water and arable land, and food waste on an enormous scale.
What next
The ‘dual circulation’ strategy that Beijing has adopted in response to supply chain disruptions and tension with the West includes maximising domestic supplies of food grains. The greater flexibility on grain imports displayed for most of the last decade will give way to increased efforts to minimise shipments from overseas. Land and labour shortages mean that technological improvements are needed for recent output growth to continue -- a realistic but uncertain prospect.
Subsidiary Impacts
- China cannot avoid dependence on imports of animal feed as its population's demand for meat rises further.
- Beijing will make greater efforts to diversify foreign sources of feed imports.
- China is immutably locked into overseas dependence for soybeans, and potentially maize and barley, too.
Analysis
China exemplifies the truism that providing for a country's food security is often less a problem of production than one of distribution (see CHINA: Food security challenge is chronic, not acute - October 22, 2020).
The supply of grain has ceased to be the significant challenge it once was. Although the 14th Five-Year Plan (2021-25) contains a binding target for grain production, this is set at 650 million tonnes -- a figure exceeded every year since 2015.
Apart from soybeans, imports of grains constitute only a tiny proportion of domestic production. Since 2010 total grain production has grown, on average, by 1.8% per annum, to reach a record 669.5 million tonnes in 2020. In the same period the average annual rate of natural population increase was juste 0.52%. The increase in average per capita grain output from 417 to 474 kilograms between 2010 and 2020 is the most significant figure of all, demonstrating that in terms of grain production, China now enjoys a very comfortable surplus above the notional 400 kilogram per head regarded as the minimum requirement for meeting its direct and indirect grain consumption needs.
China has been quite successful in expanding the sown area and production of maize through adjustments to the planting structure of other grains, such as rice and wheat. However, the potential for further sown area adjustments will be limited by Xi's insistence that cereal for human consumption must be produced from China's own resources.
Environmental and arable land constraints dictate that future grain output growth will rely on improvements in yields. Per hectare yields of rice and wheat are high by international standards, whereas those of maize offer greater scope for catch-up. Raising grain yields will increasingly rely on advanced biotechnology and artificial intelligence (see CHINA: Technology will transform rural areas - June 4, 2019).
Storage and distribution
Concerns about food security vulnerabilities in part reflect the challenge of food distribution. China's continental scope necessitates the transfer of huge quantities of grain from deficit to surplus regions. On top of this, national security considerations and renewed emphasis on self-reliance place a premium on establishing a comprehensive storage system for contingency food reserves.
Transport and storage deficiencies are responsible for significant losses of grain.
The regional distribution of grain production has changed dramatically during the last 35 years. Southern and central-eastern Chinese provinces used to generate large grain surpluses that were shipped to other parts of the country where shortages existed. Coastal economic growth and infrastructure construction have eroded these surpluses. In Guangdong, Fujian and Zhejiang, surpluses have given way to large deficits.
China has avoided a potentially serious national food deficit only thanks to the buoyant performance of a small number of provinces in the north, notably Heilongjiang, Jilin and Inner Mongolia, which accounted for almost 23% of total grain output in 2019.
Per capita grain availability falls below the 400-kilogram minimum requirement in half of China's provinces. This necessitates the shipment of large amounts of grain from the surplus regions of north and north-eastern China to deficit southern and south-western regions. In 2020, almost 76 million tonnes of grain were carried by China's rail network over an average distance of 1,800 kilometres.
Transporting such large quantities of grain incurs not only a heavy direct financial cost, but also a significant hidden cost resulting from losses of grain in the transportation process (an estimated 5%).
China has invested heavily in modern granaries in recent years. However, many storage facilities remain outdated, and the primitive conditions in which large amounts of grain are still stored generate major losses through mildew and insect and rodent infestation.
Primitive storage facilities result in large losses to vermin
The situation is exacerbated by inefficient processing techniques and inadequate logistics equipment, and has led to calls for accelerated investment in agricultural infrastructure and the establishment of smart grain depots.
Calculating the scale of grain losses between harvesting and consumption is difficult. A Chinese academic study in 2014 put post-harvest losses at 80 million tonnes, or 15% of total production. A report commissioned by the National People's Congress and published in December last year produced a significantly lower estimate of 35 million tonnes.
Food waste
Food waste in retail and the catering industry has risen alarmingly in recent years.
According to a survey by the Chinese Academy of Sciences, the main sources of waste are vegetables (accounting for 29% of total wastage), rice and noodles (24%) and meat (18%). The survey found that each consumer squandered 93 grams of food per meal, excluding additional wastage of food discarded by restaurants and canteens. In all, 18 million tonnes of food are wasted annually in restaurants in major cities -- enough to feed well over 30 million people.
30mn
People who could be fed with food wasted at restaurants
In 2020, Xi took the lead in launching a 'clear your plate' campaign, designed to reduce wasteful consumption in restaurants. He called food waste "shocking and distressing" and said "waste is shameful and thriftiness is honourable". This runs against traditional Chinese dining culture, in which large portions demonstrate generosity and respect. Restaurants nonetheless responded by serving smaller portions and urging customers to order fewer dishes.
In April last year, legislators passed an 'Anti-Food Waste Law', which requires caterers and restaurateurs to publicise the new food frugality ethos to customers.
Restaurants that fail to "take the initiative to remind diners not to waste food" will receive a formal warning. Fines of up to CNY10,000 (USD1,572) will be imposed on restaurants that "deceive or mislead diners to overorder and cause obvious waste". Larger penalties will be levied on food producers and processors who cause food waste (up to CNY50,000), and on media sources that promote competitive and binge eating (up to CNY100,000). New requirements to curb food waste have also been issued to municipal and local governments.
