Skip to main content

China's Water Choice: Grain or Coal?

An official of China's Ministry of Environmental Protection dared to think clearly about environmental and energy issues. Recognizing that both coal and grain production require large amounts of water, the official recommended that China could scale back grain production in Shanxi, Shaanxi, Inner Mongolia and Xinjiang to free up water for coal production. Instead, China could import more grain from overseas, the official suggested.

The daring proposal was made by an environmental assessment inspector  at the "2014 China international energy summit" held in Beijing July 28-30.

The official was inspired to think the "forbidden thought" of importing grain when he visited Italy and found farmers protesting outside the parliament over the cancellation of a plan to export grain that had collapsed because they couldn't find a market.

The environmental official notes that many people in China say the country should never import grain. But he doesn't see why "food security" should be elevated above "energy security", noting that China imports 60% or more of its energy. He argues that the "cold war mentality" [of grain self-sufficiency] must be broken to relieve pressure on the "precious water resources" of coal-producing areas and revive their "fragile ecology." Importing grain from Canada, France, or Italy, he says, would also reduce pesticide and fertilizer use "a little bit."

The official addressed the concern that "everything China buys gets expensive." He says if China starts importing modest amounts of grain, prices may go up at first. But the "law of the market" may make prices go down in the long-run (as other countries expand output).

This official's proposal does not appear to reflect official policy, but it is significant that someone has begun a public discussion of environmental choices. Of course, this is China and appearances can be deceiving. As the story acknowledges, importing grain has always been a taboo subject and this story's appearance on grain market web sites is unusual. It's possible the story was planted by top officials laying the groundwork to open the market to "reasonable imports" of grain--one of the key points of the new food security strategy.

Comments

Popular posts from this blog

Xi Jinping's Doctoral Thesis

Xi Jinping is the vice president and presumed next president of China but little is known about him. In this post the dimsums blog offers its contribution to the genre of Xi Jinping-ology by conveying Xi's decade-old views on agricultural markets. Ten years ago Xi Jinping wrote a thesis, "Tentative Study of Agricultural Marketization" (中国农村市场化研究) for a Doctor of Law degree at Tsinghua University in Beijing, a top breeding-ground for Chinese officials. The dimsums blogger has spent several hours poring over the 200-plus page tome to see what it reveals about Dr. Xi. The thesis is remarkably close to what China has been doing lately in agricultural policy, suggesting that Xi (or the person who actually wrote the thesis) has a major say in policy or is at least in agreement with what's being done. There is nothing adventurous, controversial (or insightful) in the thesis. It seems to be the work of a wonkish technocrat who is not prone to talk out of turn or wander from...

Divergence in U.S. & Chinese egg prices

High egg prices are a hot topic in the United States. China, in contrast, has a glut of eggs and depressed prices.  The March 14, 2025 USDA Agricultural Marketing Service weekly eggs market overview reported that U.S. egg prices continued declining during the second week of March as the supply situation improved. No significant highly pathogenic avian influenza (HPAI) outbreaks have occurred in March and U.S. egg demand is relatively light. The average U.S. wholesale price for Grade A large white eggs was $4.15 per dozen, down sharply from their February peak.  Until 2021, Chinese and U.S. wholesale egg prices had been roughly equal at about $1-to-$2 per dozen with no trend. U.S. prices fluctuated more than Chinese prices, so the U.S. price was sometimes higher, sometimes lower than the Chinese price after converting them to dollars per dozen.  Chinese prices converted using monthly exchange rate and assuming 0.6 kg per dozen. Sources: USDA and China Ministry of Agricult...

China's Corn & Wheat Imports Down 97% From Last Year

China's first customs data for 2025 feature a 97-percent decline in corn and wheat imports from a year earlier. Soybean imports were up slightly by volume (but down in value), and dairy, pork, poultry, and seafood imports rebounded year-on-year. Life was less sweet in China with a 93.7% decline in sugar imports, and drinking appears to be up as wine and beer imports posted gains.   China's agricultural imports for January-February 2025 were down 14.7 percent from a year earlier. The value of farm and food goods imported for the first two months of 2025 totaled $30.7 billion, down $5.26 billion from the same period in 2024. China's exports of agricultural products during January-February totaled $15.2 billion, up $393 million from a year earlier.  Data from China Customs Administration website. As usual, soybeans were the largest component of China's agricultural imports during January-February 2025 with a value of $6.3 billion. Meat imports were valued at $4.1 billion, ...