Dim Sums: Agricultural Markets in China

China's production of grain and meat declined in 2018, according to macroeconomic data issued by the National Bureau of Statistics . Primary sector GDP--which is composed mainly of agriculture--somehow managed to rise by 3.5 percent although no commodity posted output growth faster than 1.5 percent. China's 3.5-percent primary industry GDP growth was a little more than half the reported overall GDP growth of 6.6 percent. The primary industry share of China's GDP fell to 7.2 percent. The rural population of 564 million represented 40.4 percent of the national population. China's grain output fell -0.6 percent to reach 657.89 million metric tons (mmt) in 2018. Fall grain (including corn, fall-harvested rice, soybeans) output was up slightly by 0.1 percent, but summer grain (mainly wheat) was down -2.1 percent and early rice was down -4.3 percent. Cotton output rose 7.8 percent. China 2018 agricultural output Item 2018 output Change...

A 3-month rural food fraud crackdown is underway in China. Food safety regulation, inspection and enforcement tends to be especially lax in rural communities. This campaign, apparently timed for the peak shopping season leading up the Spring Festival holiday, is intended to reassure rural residents that authorities care about them and to improve the quality of life in the countryside. The Ministry of Agriculture said the campaign is meant to prevent potential risks arising from the large rural food market which is characterized by "low-level" consumption, served mainly by small, scattered merchants with insufficient supervision. Regulation of rural food markets is a "long-term, arduous task," the Ministry said. This post will explain the program using propaganda illustrations. [ note: about half of these images mysteriously disappeared after posting and can no longer be found online ] Propaganda cartoon shows a rat carrying "fake and shoddy foods"  ...

Debts are suffocating many agribusiness companies in rural China as shortages of working capital force closures and bankruptcies, according to reports appearing in Chinese State media last week. The reports appear to presage new credit policies to support rural development programs this year that will pile on even more debt and open a new money pit for Chinese banks. A Business Reference News report," Some Dragon Head Agricultural Enterprises Stranded ," describes mounting debts and seizing-up of credit supply among "model" agricultural enterprises in Anhui Province visited by a journalist (a "dragon head" is a leader who pulls along those behind him/her like a line of dancers in the traditional dragon dance). The report claims bankruptcies and shrinking business operations he observed among flour, poultry, bamboo flooring, and farm equipment companies are typical of the national situation and warns that "the business and financial risks are worthy...

Disposal of "irrational reserves" exceeded the target set for 2018 according to a document issued by the Administration of Grain and Commodity Reserves . China sold off a record-high 132.73 million metric tons (mmt) of grain, oilseeds, and cotton from reserves during 2018, reflecting mainly 100-mmt of corn. Rice and wheat reserve sales combined for less than 18 mmt. China's grain reserve corporation declared the destocking task for soybeans, rapeseed oil, and cotton reserves "basically complete." Sales of China commodity reserves during 2018 (million metric tons) Corn 100.13 Rice 17.00 Wheat 10.66 Soybeans 2.01 Rapeseed oil 0.42 Cotton 2.51 China's Grain Reserve Corporation purchased 26.56 mmt of rice and wheat at minimum prices during 2018, according to figures announced by the corporation's general director and communist party secretary at a meeting reviewing the year's grain...

Cases of fake data and manipulation of results in China's agricultural census were revealed by the National Bureau of Statistics last month. The National Bureau of Statistics' " Notice on 7 Typical Cases of Agricultural Census Fraud and Falsification " released December 27, 2018 listed seven examples of fraud and interference by local officials uncovered by follow-up inspections carried out during 2017 and 2018 (the census was conducted in early 2017). In spot checks of rural households in several counties, residents said they had never been contacted by census enumerators. In other instances, the data transmitted by enumerators' handheld electronic devices did not match data on paper report forms. In once case, inspectors found stacks of blank report forms. In Shanxi Province's Pingguan County inspectors surmised that census enumerators had filled in households' census report forms themselves using administrative records and by making phone calls.  I...

A China agriculture ministry review of 2018 market conditions highlighted adequate supplies, stable prices, limited impacts of trade tensions and African swine fever, progress in reforming grain price policies and promised continued disposal of excess corn and rice stockpiles. Steep declines in vegetable prices during 2018 were attributed to normal seasonal factors. Stability now may foreshadow future deficits when the government's corn stockpile is finally depleted and pork supplies could shrink as pessimistic farmers worried about African swine fever hesitate to restock pig barns. Tang Ke, director of the market information office of China's Ministry of Agriculture and Rural Affairs, reviewed agricultural market developments during 2018 and discussed the outlook for 2019 at a press conference held in Beijing today. During 2018, China's corn sector revolved around efforts to dispose of massive government stockpiles. Auctions of government corn reserves sold over 100 ...

China has food safety problems stemming from fraud and pollution of farming areas, according to remarks by a Chinese food science expert praising the overall improvement in the country's food safety situation . The speech also highlighted new challenges posed by China's rapid growth in demand for health foods, e-commerce, and imported foods. The comments were made by Professor Meng Suhe, director of the Nutrition and Health Institute of China's Center for Disease Prevention and Control, at a December 2018 meeting that assembled a team of food scientists to address the year's food safety hot topics for attendees from news media. The speech pointed to improved compliance found in government testing of dairy, meat, grains, and eggs, a reduction in microbiological food safety incidents, and reduced concerns about food safety in public opinion polls as indicators of an improving food safety situation in recent years.  Although the food safety situation is "stab...