Dim Sums: Agricultural Markets in China

In November 2012, heavy snow closed a highway outside Beijing. A township government sent workers out to deliver free boxes of rice to drivers stuck on the road. Most drivers were suspicious of the workers and refused the rice. Many would not even open their doors. This is one of many incidents reflecting the collapse of trust in Chinese society. With trickery and deception so common, China has become a giant "market for lemons." How can you have a healthy economy and society if every product is assumed to be defective or fake and every person offering a service is assumed to be duplicitous? A man steals what looks like a traditional Chinese coin,  making the Chinese character for "trust" collapse. In January 2013, the sociological research institute of the Chinese Academy of Social Sciences released a social attitudes survey that showed a declining degree of social trust. Over 70 percent of respondents do not trust strangers. Their trust in business opera...

Shanghai and Jiaxing Prefecture officials have been jointly trying to use information on dead pigs' ear tags to trace floating pigs back to their original owners. The vice mayor of Jiaxing says that 8 have been traced to their farmers who have been slapped with penalties of 3,000 yuan ($475). Reporters have been snooping around Jiaxing and finding out about where dead pigs came from . In 2010 Jiaxing authorities built pig-disposal pits in every village. These are large cement tanks that break down pig carcasses using anaerobic fermentation. Each one holds about 40 metric tons of pig carcasses. Pigs are heavy and it's troublesome to transport them to a disposal site. Farmers had to pay someone 80 yuan ($13) to haul a dead pig away, so it was cheaper and easier to put the pigs in a bag and dump them on a creek bank or by the side of a road late at night. One person said that if you drive on the expressway from Hangzhou to Shanghai with your car windows down you can smell the...

With sluggish demand, high moisture content in corn, and high costs of transporting grain, corn prices in the northeast have been weak. Sinograin--China's grain reserve management corporation--has been purchasing corn in northeastern provinces to prop up prices. Sinograin's Heilongjiang branch has bought 5.5 million metric tons of corn to support prices so far this season. In Jilin Province Sinograin had set up a research group that was making assessments of grain quality, market prices, farmers' selling expectations and processors' inclination to purchase corn.  In Inner Mongolia they have bought 1.78 mmt and opened additional depots to buy grain at support prices. Officials are worried that high moisture levels of the corn will cause the corn to get moldy. They are urging farmers to dry their corn themselves and making sure granaries don't end up holding rotten grain. In Heilongjiang, the Sinograin depots are offering special services to large grain farmers ...

There is a lot of discussion of how to consolidate Chinese farms, and many view "family farms" as the main model for the future. Chinese officials have been including this term in a lot of their strategy statements--including this year's "Number 1 Document"--but there is no definition of what a "family farm" is. Like many things in China, confusion abounds since there are conceptual and legal ambiguities regarding the "family farm." The concept in China is similar to the American concept but has to be understood in context of China's existing system. Moreover, a commercially-oriented "family farm" business is in a legal gray area since it does not fit into China's communist administrative structure that has separate lines of authority for peasants and industrial enterprises. The usual Chinese word for "farm" is nonghu (农户) but this actually means "rural household." "Nong" (农) can mean either...

A Chinese news site paired these two news items side by side: " Small and Medium Businesses Face "Five-Famine, Double-High, One-Low" Difficulty " COFCO Takes Over China Grain to Create Grain Business 'Super Aircraft Carrier'" " Small and Medium Businesses Face "Five-Famine, Double-High, One-Low" Difficulty  describes how small and medium businesses are often frozen out of access to essential resources for doing business. Chen Zemin, the chairman of a frozen food company, identifies five "famines" facing small and medium businesses in China. First, they have a hard time finding enough workers. Second, a money famine--they have a hard time getting financial capital and have to borrow at high rates. Third, land is hard to get and small companies are often left out of big projects. The fourth and fifth famines are electricity and water which are controlled or given out at favorable rates to some businesses. "Two high...

In a press conference this week , one of China's vice ministers of agriculture articulated the Ministry's nuanced approach to agricultural genetically-modified organisms. While agricultural officials are generally in favor of GMOs as a way of feeding the population, they approach them with caution. There are also strong anti-GMO opinions spreading in China and there's a strong sense of nationalism in much of the rhetoric. Vice Minister Chen Xiaohua called for developing GMO varieties as fast as possible while keeping tight control through careful safety monitoring and assessment. Chen said, "We must strengthen research, developing advanced varieties through national GMO projects as soon as possible." He added, at the same time China must "...pay a lot of attention to biosafety issues, setting clear regulations and procedures to guarantee the safety of genetically modifications." China's approach to GMOs has global implications since China is ...

The news that thousands of dead pigs are floating in Shanghai's Huangpu River is being carefully managed by Chinese officials. The news apparently was kept bottled up while the "two meetings" were being held in Beijing. The news was first reported in the newspaper of Jiaxing on March 4, but it did not hit major news media until March 11. The first message was that the water is still safe to drink. Now attention has turned to quelling any rumors of a pig disease epidemic. Vice Minister of Agriculture Chen Xiao emerged from the big meetings in Beijing to give answers on the dead pigs at a press conference . He explained that it's normal for pigs to die and the best you can do is keep the mortality rate to a minimum. Chen said statistics reported to the Ministry show that the animal disease situation has been stable with only three outbreaks of foot and mouth disease. Of course, he acknowledged that some small, backward farms don't use good practices and are vu...