Dim Sums: Agricultural Markets in China

China has set up a traceability system to track imported frozen food. Shipments of imported frozen meat and seafood have had to undergo disinfection and special handling since mid-2020. Now shipments have to be accompanied by certificates proving they have been disinfected, must be tracked as they move into domestic transportation and storage facilities, and should be sold on special shelves and counters.  The traceability platform for imported frozen food was announced at a December 1 teleconference held by the State Administration for Market Regulation (SAMR). Food companies will have to report the source of food shipments, the amount, their current location and destination. Receipts must be complete and inspection and disinfection certifications must be transmitted with the shipment. The information must be reported and be accessible to accelerate epidemic prevention and control, according to the SAMR's explanation. Imported frozen food cannot be sold without an inspection/qu...

China's swine herd has been rebuilt to 90 percent of its normal size--so we're told by the agriculture ministry. A perusal of the web site for the organization that counts livestock reveals that Chinese agricultural officials are in the midst of a major overhaul to address dysfunction in the pig-counting system at the same time the structure of pig farming is undergoing dramatic change. Here's a hypothetical series of conversations that make some of the problems concrete: “Hi, Old Wang. This is Zhu Bingdu from the village veterinary station.” “Hi Bingdu. How’s it going” “Not bad. Can you tell me how many pigs you have on your farm this month?” “Um, I’ve got 250 right now, but I’ll be sending 50 to the slaughterhouse on Monday.” “OK, I’ll split the difference and put down 225.” “Sounds good. Talk to you later.” “OK, bye.” ------------------ “Hello, Old Wang. This is Zhu Wuran from the county environmental protection department. I’m doing a survey of agricultural pollution. C...

China's swine inventory has recovered to near-normal levels, but supplies of pork are lagging, according to preliminary 2020 data released by the country's National Bureau of Statistics .  The inventory of swine at the end of 2020 was 406.5 million head, up 31 percent from 2019 and not far from the average since 2000. The number of hogs slaughtered during 2020 was 527 million, down 3.2 percent from 2019 and still far below the 694 million slaughtered in 2018. The slaughter number was China's smallest since the year 2000. Source: data from China National Bureau of Statistics. Quarterly swine inventory estimates show a relatively modest dip of about 25 percent from Q4 2018 to the low point in Q3 2019. That's a much smaller drop than the 40-plus percent reported by China's ag ministry. The Q4 2020 inventory reported by the Statistics Bureau is not far off the pre-African swine fever level.  Source: China National Bureau of Statistics data. Quarterly data indicate that...

Chinese authorities approved genetically modified corn seed produced by Chinese company less than a month after the top leadership called for strengthening the nation's seed industry as a critical task for 2021.  China formally adopted a nationalist seed industry policy at the December 16-18, 2020 "economic work conference" where " solving the seed and cultivated land problems" was featured as the fifth of eight key economic tasks for 2021. Another layer of "seed security" (种子安全) has been added to "food security" (粮食安全).  China's propaganda machinery has modified the national food security strategy slogan to emphasize the importance of "filling Chinese bowls with Chinese food grown from Chinese seeds " [emphasis added]. The seed initiative also fits into Xi Jinping's new economic strategy of reliance on native Chinese technology as the economy moves into a new phase of development. Another slogan promoting the seed industry...

Chinese corn began the first 10 days of 2021 with a 5-percent price increase, according to raw material prices released by the National Bureau of Statistics. After relentless increases throughout last year the January 2021 average corn price was up 48 percent from a year earlier. China has been showing signs of growing price volatility since the final months of 2020. Source: China National Bureau of Statistics raw material prices. China's soybean meal prices were up and down during 2020. A 14-percent increase in the final month left the average soybean meal price up 26 percent from a year earlier in early January. Hog prices surged 10.5 percent over the most recent month. The price of hogs is at the same level as a year ago when China was suffering from a severe shortage of pigs. The Ministry of Agriculture and Rural Affairs told us swine numbers have been recovering since then, and the ministry reported that the volume of hogs slaughtered by above-scale slaughterhouses in December...

China's Hebei Province issued an emergency order this week to prevent disruption of fresh milk and chick deliveries during the region's covid-19 lockdown this month.  Hebei's capital city Shijiazhuang has been locked down, and authorities have limited transportation all over the province after 39 new cases prompted testing that turned up another 354 cases. The emergency notice from Hebei's agriculture department  dated January 6, 2021 advised farmers that fresh milk needs to be delivered to processors within 24 hours and chicks must be delivered to farms promptly to ensure their survival. According to the circular, deliveries of fresh milk and chicks have been disrupted by strict controls, disinfection measures, temperature-taking for drivers, and closure of roads to delivery trucks in some areas--including Shijiazhuang. The circular warns that failure to deliver could result in dumping of milk, death of birds, major financial losses to farms, and pollution.  In another...

Chinese officials are desperate to funnel investment into the countryside following an investment collapse in 2019 that was exacerbated by the covid lockdowns in the first quarter of 2020.  China's Ministry of Agriculture and Rural Affairs (MARA) bragged that fixed asset investment in agriculture grew by 18.2 percent in January-November 2020 as the Government poured money into the countryside to achieve "rural revitalization" and an "all-round moderately well-off society" this year. The ag investment growth was much faster than the overall growth of just 2.6 percent for the first 11 months of 2020.  According to MARA, the complex economic situation and pressure from the covid virus in 2020 prompted seven government departments to issue an opinion on accelerating agricultural and rural investment to overcome shortcomings in rural areas. The government's strategy includes direct spending on infrastructure and agricultural subsidies, ordering local authorities...

China's release of 70,000 metric tons of national pork reserves in December 2020 brought the 2020 total to 670,000 metric tons. A total of 38 sales were held during 2020 as authorities sought to bring record-high prices under control. Reserve sales during 2019 totaled 170,000 metric tons during September and December--ahead of major holidays--as pork prices first began to soar. Releases were 20,000 metric tons in most weeks from December 2019 to September 2020 as pork prices remained stubbornly high. Sources: China commodity reserve management company announcements and China Ministry of Agriculture and Rural Affairs. All of the national pork reserves released during 2019-20 were sales of imported frozen pork. Sales of reserves in 2019 of 170,000 mt equaled 8.5 percent of China's 2 million metric tons (mmt) of imports (harmonized system code 0203) and the 670,000 metric tons of reserves sold in 2020 equaled 17 percent of 2020 imports which will be more than 4 mmt. Authorities di...

China's animal feed production through November 2020 was up 9.5 percent from the same period a year earlier. The rebound in swine feed and sustained production of poultry feed is likely to bring the calendar year feed total to a record high. These numbers are not a complete accounting of feed use in China--they don't include feed mixed on-farm--but the data do suggest that China's industrialized "efficient" farms are bumping up demand for commercial feeds as they replace "backyard" DIY on-farm feed mixers and garbage-feeders. China's feed industry association reported that feed output for the month of November 2020 was up 12.6 percent from November 2019 when feed output was depressed due to African swine fever's decimation of the pig population. November feed output was up 8.6 percent from November 2018--before the epidemic was in full swing. Cumulative January-November 2020 feed output was about 229 million metric tons (mmt). December output (n...