China’s positive stance on global food policy

Author: Katherine Morton, ANU

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.

But while China has managed for centuries to remain self-sufficient, it will not be able to do so in the future. Ten per cent of the Chinese population is estimated to be undernourished, the rural labour force is declining, and agricultural productivity is increasingly vulnerable to climate change, natural disasters and water shortages. For planning purposes, China must have at least 1.8 million mu (120 million hectares) of arable land to produce enough food to meet future demands. But around two-thirds of available land in China is now classified as either barren or low in agricultural potential, and smallholder Chinese farmers are leaving the land. If farmers do decide to stay they must overcome lower returns on traditional crops and the rising costs of diesel fuel, chemical fertilisers and pesticides. It is no surprise that Chinese farmers are now seeking new opportunities at home and abroad.

China has recently begun expanding its agricultural investment overseas, a move that reveals a more flexible approach toward self-reliance. Still, it is difficult to substantiate criticisms that China is now ‘grabbing land’ overseas to produce food to ship back home. Chinese corporations are involved in producing food in neighbouring countries for the domestic market, one example being the 400,000 hectare farm on the China–Russia border jointly owned by China’s Huaxin Group and Russia’s Armada software company. But the situation is quite different on the African continent, where Chinese companies produce food to meet local needs or to sell on the international market.

The issue of global food security in the 21st century is undoubtedly complex. Experts agree that we can no longer rely upon an abundant supply of cheap food. Environmental challenges now severely constrain sustainable agriculture and the world’s growing prosperity has not made it easier to eradicate hunger: almost one-fifth of the world’s population remains undernourished. Food prices are likely to remain high in the near future, so the world needs a stronger regulatory framework to mitigate the negative effects. Food security today is as much about stabilising markets as it is about ensuring an adequate supply of safe and reliable food to the world’s most vulnerable communities. So more than ever, food security depends on open markets.

China is now more integrated into the global food economy. It has expanded agricultural investment overseas and is increasingly active as a food donor. These new activities bring new international obligations. In recent years, Beijing has expanded agricultural development projects throughout Africa, Asia and Latin America, and increased emergency food relief. In 2011 China pledged US$70 million in grain aid to drought-stricken countries in the Horn of Africa, a donation promoted in the official media as the largest contribution in the history of the People’s Republic. China’s responses to regional and global food policy challenges are large enough now that they have an important impact on whether food distribution is fair and reliable.

To date, the Chinese government has been supportive of collective efforts to establish a food security safeguard system, reduce competition between food and fuel, and strengthen the regulation of food reserves in response to emergencies. It has increased its donations to the Food and Agricultural Organisation (FAO), the World Food Programme and the International Agricultural Consultative Group, and now plays a stronger role in the newly reformed FAO Committee on Food Security. There are tensions over what approach works best in delivering food aid, and it is not entirely clear whether Chinese policy makers are interested in promoting open market access. But China’s engagement in global food policy making is positive. China’s domestic and international experience might even see the emergence of a new global norm — collective reliance.

Katherine Morton is Senior Fellow at the Department of International Relations, School of International, Political and Strategic Studies, the Australian National University. 

This article appeared in the most recent edition of the East Asia Forum Quarterly,‘Energy, Resources and Food’.

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