Dim Sums: Agricultural Markets in China

Corn and soybean growers will each get subsidy payments for their 2017/18 crop in China's largest grain-producing province, as officials try to coordinate subsidies for different crops to engineer a shift from corn (China has a surplus) to soybeans (China has a shortage). A May 9, 2017 announcement by Heilongjiang Province said farmers in the province will get subsidies based on the land area they plant in corn and in soybeans. The announcement promised that the soybean subsidy will be larger than the corn subsidy to encourage farmers to shift acreage from corn to soybeans, but the amount of the subsidies will not be determined until later in the season. Payments will be distributed to farmers by September 15, 2017. The determination of the subsidies will occur over the next three months through a gigantic bureaucratic process. Statistical, financial, price bureau, and state farm officials at four levels of government will compile l...

Chinese hog prices are on the decline again after reaching record-high levels in 2016. Pork market analysts writing in Farmers Daily last week observed that hog prices had fallen 15 straight weeks since the Chinese New Year holiday. The Ministry of Agriculture's weekly livestock price report released May 23 --the day after the Farmers Daily article--showed another 2.6-percent weekly decline. The average hog price of 14.34 yuan per kg was 28.6 percent lower than a year earlier. The Farmers Daily article attributed falling prices to a rebound in production prompted by historically high net returns of 200 yuan on a 115-kg hog in January. While authorities have closed many medium and small-scale farms in their campaign to enforce tighter environmental regulations, many large feed and meat companies are expanding aggressively. Many are building giant sow farms and recruiting farmers to fatten piglets they supply under a "company + farmer" business model. The...

China has announced ambitious plans for international cooperation in agriculture that aims to create a new world order in agricultural production, technology, and international trade. " Vision and Action for Building 'One Belt One Road' Agricultural Cooperation ," appeared in its  Farmers Daily  newspaper with authorship attributed to the Ministry of Agriculture, National Development and Reform Commission, and China's State Council. It was posted May 12, 2017, just in time for the "One Belt, One Road" to be held in Beijing May 14-15 with dozens of world leaders in attendance. "One Belt One Road" is China's initiative to revive ancient trade routes between Asia and Europe, and which also run through poor countries in Asia and Africa. In addition to building railways and other logistic infrastructure and investing in factories, China hopes to take the lead in sharing its successful experience in agriculture with the "belt road" co...

China's Ministry of Agriculture issued its May 2017 China agricultural supply and demand (CASDE) report which included the first estimates for the 2017/18 market year. The report shows a 2.9-percent decrease in corn production estimated for the 2017/18 crop to 213.19 million metric tons. The decline is mostly due to a 2.5-percent decrease in corn area planted. China corn supply and demand (Ministry of Ag, May 2017) Item Unit 2016/17 Apr 2016/17 May 2017/18 May Planted area 1000 ha 36,026 36,760 35,840 Harvested area 1000 ha 36,021 36,760 35,840 Yield Kg/ha 5,978 5,973 5,948 Production MMT 215.33 219.55 213.19 Imports MMT 1 1 1 Consumption MMT 210.72 210.72 215.07 --Food MMT 7.82 7.82 7.89 --Feed MMT 133.03 133.03 135.03 --Industrial use MMT 58.25 58.25 59.75 --Seed MMT 1.61 ...

China's new "Aid + Market" initiative blurs the lines between foreign aid and commerce by using technical assistance projects as a platform to export hybrid rice seed. The program was announced in conjunction with a 500-billion yuan (?!) agreement signed last month between Longping High Tech Agriculture Co. and the Sanya Municipal research institute to set up a foreign market research and development center in Hainan Province. Longping is a seed company formed by two Hunan Province rice research institutes in 1999. It is named after its figurehead, Yuan Longping, known as "father of China's hybrid rice." The company has carried out Chinese rice demonstration projects in Southeast Asia, South Asia, and Africa for many years. According to 21st Century Business Herald , the new strategy is part of the One Belt One Road initiative which aims to build new trade routes from western China to Europe through Central and South Asia. Many of the Belt-R...

In 2007, when pork prices were soaring to record highs Chinese officials rolled out a half-dozen pig subsidies and sent rural bankers to knock on doors offering villagers loans to build pig farms. Now--exactly ten years later--the manure from these farms has become a severe pollution problem. The same officials are paying farmers to demolish their farms and either move them out of sight in the hinterland or find another way to make a living. The Masses Daily reported a story from Shandong Province's Liangshan County last month that shows not everyone is happy with the farm-closure campaign at the local level, and not everyone is getting compensated for destruction of their property. In Han'gai, a town in Liangshan County, there are about 200 small-scale hog farms. All of them are about 500 meters from villages, but local people still complain about the smell and large numbers of flies. The main concern, however, is the large volumes of untreated manure that washes into r...

A campaign to curb garbage-feeding of pigs illustrates efforts of China's current regime to cope with the country's transformation to an urbanized economy by cleaning up the environment and repurposing "waste" as resources. During April, Chinese news media in a number of cities ran articles calling attention to the hazards of feeding restaurant waste to pigs. The most prominent is an investigation of "garbage pigs" or "swill pigs" on the outskirts of Tianjin by China's national Xinhua News Service. The journalist reported finding a location outside Tianjin's ring road where about a dozen farmers raised 100-200 pigs each on waste gathered from restaurants. The operations consisted of a semi-enclosed area where waste cooked, crude brick sheds where pigs are kept, and crude brick structures that serve as living quarters for employees. Small vans loaded with blue barrels and plastic bags used to collect waste from restaurants were parked out...