Dim Sums: Agricultural Markets in China

China's Guangdong Province issued a set of pork supply directives calling on city and county officials to ensure pork supplies and stabilize prices: make land available for farms and slaughterhouses; include farms, slaughterhouses, and diseased carcass disposal facilities in annual land use plans ease up on over-zealous enforcement of environmental restrictions on where farms can be built ensure bank loans support farms and slaughterhouses and subsidize loans when feasible  expand insurance for sows and hogs, pay out indemnities promptly, increase payouts, and experiment with "target price" insurance for hogs give aid to clean up and consolidate slaughterhouses using funds from an 80-million-yuan agricultural development fund stop feeding restaurant waste to pigs; develop plans for collecting, transporting and treating food waste; set up demonstration projects by the end of the year expand city frozen pork reserves and use them to adjust supplies and stabilize po...

Tightness in China's pork supply is becoming evident in July 2019 as shrinkage of the sow herd since last fall reduces supplies of finished hogs. Statisticians from different departments reported widely varying statistics, but all point to substantial shrinkage in supplies. Agricultural officials nervous about rising pork prices have effectively declared a premature victory over the African swine fever epidemic and ordered local officials to subsidize a re-stocking of pig farms to bolster supplies. The Ministry of Agriculture and Rural Affairs June report on hog and sow numbers in 400 counties showed a 25.8-percent year-on-year decline in the inventory of hogs and a 26.7-percent decline in the inventory of productive sows. The inventory of hogs and sows both fell 5 percent in June. Seven years ago the Ag Ministry stopped reporting their estimate of the actual number of swine so it would not conflict with the number reported by the National Bureau of Statist...

A Chinese academic noted the growing importance of livestock to China's agricultural economy, but also warned of the sector's weaknesses: whack-a-mole epidemics, reliance on imports for core inputs, low productivity and high costs. The comments by agricultural economics Professor Wang Mingli of the Chinese Academy of Agricultural Sciences were reported by No. 1 Business News on the release of his institute's report on challenges and countermeasures for supply-side structural reform in the agricultural sector. According to Prof. Wang, livestock accounts for 28 percent of the value of China's agricultural output, and perhaps as much as 40 percent (presumably taking into account feeds, fodder crops, and related activities). There is much room for growth, he said, because China's per capita availability of meat, dairy, and egg products is still much less than in developed countries. Prof. Wang said the growing share of China's agricultural sector is irreversibl...

" How high can pig prices go in the second half of 2019? " asked an article posted on Chinese pork industry site zhue.com.cn this week. Pig prices have actually gone up surprisingly little over the past year in view of the huge declines in swine numbers reported in China. Prices dipped in February and hog prices really just began to show clear upward momentum in June 2019 in most parts of China. Prices are still falling in southwestern provinces where another panic slaughter phenomenon has been underway. Chart from zhue.com.cn showing Chinese hog prices from January 1 to July 2, 2019. Orange line represents northeastern provinces; blue represents national average; gray line represents Sichuan Province. Nevertheless, rising Chinese hog and pork prices in the second half of the year are an "indisputable fact," zhue.com.cn said. China's Ministry of Agriculture and Rural Affairs (MARA) reported an average live hog price of RMB 16.72/kg in the last week of June,...

Government officials and news media describe this year's soybean revitalization plan as something new, but China has rolled out a continuous cycle of similar plans going back decades. All of the plans aimed to introduce new cultivars, raise yields, expand production, and forge links between farmers and processors, but no significant progress is evident. The tendency of Chinese officials to keep re-booting and forgetting the same old plans in a manner that recalls the movie "Groundhog Day" is perhaps most evident in its unending cycle of soybean revitalization plans. Nearly 40 years ago, a USDA report remarked, "China will again attempt to expand soybean production in 1980, although past efforts have had little success." A year later, British professor Kenneth Walker wrote, "Attempts to reverse the long-run decline in the production of…soybeans are now being made." In 2000, Chinese officials began an experiment with the first direct subsidy paymen...