It's said that doing the same thing over and over again and expecting different results is the definition of insanity. By that definition China's agricultural policy is insane.
This month China released the latest in a string of "No. 1 Documents" on rural priorities issued each year since 2004. (An earlier set was issued from 1982-86.) The same programs keep coming up, often with the exact same language. Some long-forgotten programs are intermittently resurrected despite having failed in the past.
This year's document has several failed programs resurrected from the dead.
The document directs provinces to experiment with a "dynamic mechanism" linking farm input subsidies to rises in input prices. This apparently is institutionalizing the so-called "one-time subsidies" given to compensate farmers for high input prices each of the last 3 years. The subsidies were given out in 2-to-4-billion-yuan tranches in an ad hoc manner, multiple times in 2021 and 2022. Last year's document instructed officials to "perfect the mechanism for offsetting increases in farm input prices." This year it has become a new subsidy program.
The "dynamic input subsidy" echoes a similar "comprehensive input subsidy" that began in 2006 to help farmers cope with rising costs of fuel and fertilizer. That subsidy also began in an ad hoc manner, given out as an emergency during the farming season, then institutionalized. Authorities then announced a dynamic mechanism to link the subsidy to increases in fertilizer and fuel prices--exactly the same as the instructions in this year's document. The earlier subsidy ballooned from 12 billion yuan to 107 billion yuan between 2006 and 2012. It proved ineffectual and was folded into a single "land fertility" subsidy along with seed subsidies and a grain producer payment.
This year's document also includes an instruction to continue the land fertility subsidy, but there is no instruction to ensure that the subsidy funds are actually used to improve fertility.
This year's instruction to raise the minimum price for wheat previously appeared in documents for 2009-2013. Then it switched to "continue implementing the minimum price policy for wheat and rice." The increase in minimum prices prompted a WTO challenge from the U.S. initiated in 2016 (which China lost). The 2017 document's instruction to "rationally adjust the minimum price" reappeared in the 2023 and this year's document.
A proposal in this year's document to explore a mechanism for rich grain-consuming provinces to financially compensate poor grain-surplus provinces has been around for at least 15 years.
Another blast from the past is the instruction in this year's document to pursue a 3-year action plan to develop tea oil and oilseeds grown on trees to reduce reliance on imported oilseeds. The tea oil strategy was pursued in the 1980s, failed and disappeared down the memory hole. Another big initiative during the mid-2000s was to grow jatropha trees to produce nuts that would be used to produce oil for biodiesel fuel. Jatropha trees were planted all over the mountains of western China but the plan soon collapsed.
The new document's instruction to support development of high-oil soybean varieties is also familiar. There have been a series of soybean revitalization programs since the early 2000s that called for efforts to develop and disseminate high-oil soybean seed varieties to make domestic soybeans more attractive to crushers. Most Chinese soybeans are rich in protein but low in oil content, making them only profitable for use in tofu and other food products.
Other language that keeps reappearing includes orders to crack down on smuggling of agricultural products, protection of "black soil," and to increase use of organic fertilizer.
Why do Chinese officials keep regurgitating the same policies? Copy-paste is a much easier and less risky approach than thinking up and debating new policies. Communists have a deep memory hole, and all history must validate the success of the State's policies. Policy failures are never discussed in Chinese books. Moreover, China's agricultural cadres all yearn to be promoted to escape backwater agricultural assignments, so the cadres who saw the policy fail 10 years ago are no longer around when the policy is reintroduced.
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