Dim Sums: Agricultural Markets in China

As Chinese enterprises growing crops in Russia bring commodities back into the country at an accelerated pace, inspection and quarantine capacity is being upgraded to handle the increased flow of oilseeds and grain. The trade is still relatively small but it provides a window on how China is gradually ramping up its "going out" strategy to grow crops abroad. China customs statistics show that imports of corn, soybeans, and rapeseed crossing into the two districts bordering the Russia Far East totaled 570,000 metric tons for January through October 2015. The volume dwarfs the 100,000-mt total for all of 2014. Soybeans grown in Russia and entering at the Heihe and Suifenhe crossings account for over 280,000 metric tons. About 70,000 metric tons of corn grown in Russia has been imported so far. Corn from Ukraine entering at the Manzhouli border crossing accounts for another 200,000 metric tons. The Manzhouli border crossing reported that 49 rail cars containing rapeseed ...

China may revise its regulations on labeling genetically-modified food , according to remarks by a Ministry of Agriculture official earlier this month. This appears to be part of the groundwork for a more pro-GMO approach in coming years. The remarks were made at the fourth in a series of meetings held by the Ministry November 7, 2015 to educate news media about genetically modified organisms. The meeting gathered agricultural scientists who commented on the importance of keeping up with this technology and dispelled myths about genetically modified foods that have spread among the Chinese public. The meeting was reported by Beijing Youth News , a media organ of the communist party youth league. It appears to be a thrust to reshape public opinion as China pursues a more pro-GMO course for agriculture. He Yibing, the head of the Ministry's scientific education office, said China's nearly 15-year-old regulations for labeling genetically modified foods are being considered for...

China has announced a new strategy for food security that emphasizes potential production instead of actual production. The new strategy for the 13th five-year plan has a slogan that translates roughly as "land as a storehouse, technology as a storehouse." The strategy calls for idling stressed land to restore its fertility and for relying on technology to produce more from the land. The strategy was announced in a document entitled "Xi Jinping's Fourteen Strategies for the 13th Five-year Plan." The propaganda article for cadres to study mentions Xi's name ten times -- mostly quotations from him -- and includes four photos of him visiting agricultural areas. Xi explains that feeding 1.3 billion people is a huge task that China has to do mainly by itself: "China's food bowl must remain firmly in its own hands." Feeding the population is a crucial test of good governance, Xi further explained. Xi Jinping seems quite pleased with this ...

China's imports of sesame seed from Africa have exploded this year. By September China had already imported 700,000 metric tons of sesame seeds during 2015, easily surpassing last year's record purchases. Nearly all of the imports come from Africa (other suppliers include Myanmar, Bangladesh, and India). Ethiopia, Sudan, and Tanzania have been the leading suppliers for a number of years China's Grain and Oils News reports that the flood of sesame was triggered by big harvests in Ethiopia and India that caused prices to plummet. However, customs statistics show that this year's surge of imports comes from relatively new suppliers Togo, Niger, and Mali. The volume of imports from Ethiopia--the leading supplier for the last 10 years--has been relatively stable. Last year, Nikkei Asian Review attributed a spike in global sesame prices to China's growing demand for imported sesame seed, although it also mentioned a poor harvest in India. This year, prices are f...

China produces half of the world's pigs yet it has now become a leading importer of the meat. The Chinese pork industry complains that imported pork is putting downward pressure on prices, but this pressure may be what the industry needs to force it to reach world standards. According to one domestic industry analysis this month, the soaring imports are causing "resentment and panic" among hog producers in China. The article reports that imports of frozen pork for January through September 2015 totaled 512,000 metric tons, close to last year's total for the whole year. But that total only counts muscle meats. Another analysis this month reports that imports of all pork products totaled 870,000 metric tons and was up 45% from last year. The first analysis estimates that pork imports may equal 5% of the country's pork market if imports of variety meats (organs, snouts, tails, ears, etc) and smuggling are added together. The opening of two inland ports to h...

Chinese authorities are preparing to designate land on the outskirts of cities as "permanent farmland" that will be off-limits to nonfarm development. Local officials have been dragging their heels on implementing the program, and this month a steering committee was set up to force them to literally "get with the program." Irrigation pipes installed on "permanent farmland" in Jiaxing, Zhejiang Province . The "permanent farmland" designation program was launched jointly by the Ministries of Agriculture and Land Resources in January 2015. Each province will be required to designate areas surrounding 106 key cities as permanent farmland.  According to  Farmers Daily , a steering committee was formed in November to push along work on the program. Progress on delineating permanent farmland is uneven and has moved slowly in many regions where local officials have not given it a high priority. "The results are not ideal" so far, accordi...

China's Ministry of Agriculture has introduced a plan to convert farmland planted in corn to other crops in order to alleviate a massive surplus and mitigate the environmental damage caused by planting corn in environmentally-fragile regions. The targeted area for conversion to other crops is equal to approximately 9 percent of current corn area. On November 2,  the Ministry issued a document that prescribes an elaborate "corn structural adjustment" program to reduce corn production in environmentally fragile cold, arid, mountainous, and eroded areas on the fringes of the country's corn cultivation region. This "sickle region" encompasses the northeastern provinces, parts of northern China with falling water tables, mountainous areas of north central China, the deserts and grasslands of northwestern China, and mountainous and rocky areas of the southwestern provinces. This region is described as having low yields vulnerable to drought. It lacks irrigation...

After Chinese customs authorities began their crackdown on smuggling of agricultural products last year, smugglers have shifted their routes to remote mountain areas where they are harder to catch. The trade is apparently so profitable that smugglers are using excavating equipment to build new roads. According to Grain and Oils News , the "green wind" campaign to crack down on smuggling of rice and other agricultural products into China has led to arrest of ten smuggling rings since the campaign was launched last year. While the program has "effectively curbed smuggling," the situation is still "grim." Smugglers are still in business and have increased the scale and professionalism of their operations. The director of the Guangxi Province Grain Industry Association explained that farmers in neighboring countries like Vietnam, Thailand, Laos, Cambodia can grow up to three crops of rice annually at much lower cost than Chinese producers. The price of ric...

For years, authorities in an obscure corner of northeastern China have been trying to crack down on counterfeits of their region's premium rice. Selling expensive food is a popular strategy for promoting prosperity for farmers, but the failure of local authorities to protect their rice trademark--and the proposed solutions--is a sign of trouble for China's economic transformation. China's Xinhua News Service estimated earlier this year that 90 percent of rice sold in China under the high-quality "Wuchang" geographic trademark was fake. On November 3, a crackdown on fraudulent rice commerce was announced by authorities in Heilongjiang Province, the region where authentic Wuchang rice and most of the fakes originate.  Wuchang rice is a prized type of short-grain rice grown in a fertile region of northeastern China. The soils, weather conditions and the particular varieties grown in the Wuchang region of Heilongjiang Province are believed to give the rice un...