Dim Sums: Agricultural Markets in China

China's third-quarter pork output in 2022 was about the same as a year ago, yet prices are about twice as high. Something's wrong with this picture. Data in the National Bureau of Statistics' Q3 2022 report indicate pork output was 12.1 million metric tons, almost the same as last year's Q3 output of 12 million metric tons. The number of hogs slaughtered during Q3 this year was almost identical to last year, at 154.5 million, and the inventory of hogs was slightly higher than a year ago.  Data from National Bureau of Statistics quarterly reports. The report claimed that the hog price was up 36 percent from a year ago. The September consumer price index also reported a 36-percent increase in consumer pork prices. However, these figures vastly understate the increase in prices indicated by Ministry of Agriculture price reports which show wholesale pork prices nearly twice as high as last October and hog prices are up nearly 140 percent from last October.  Ministry of Agr...

Rice quality has been reduced by this year's drought conditions in south China. Cngrain.com reports that hot, dry weather has resulted in low yields, low milling yields, and degraded quality that could affect the appearance, texture and taste of long grain rice. The problems have become apparent since the October 1 National Day.  Rice with quality problems is fetching low prices, while supplies of good quality rice are tight. Grain and Oils News reported last month that the low quality of this year's crop was boosting demand for old crop long grain rice released from reserves.  Authorities began purchasing long grain rice at minimum prices in Anhui, Jiangsu, and Henan Provinces this month. Such purchases are authorized only when market prices fall below the minimum price--set this year at 129 yuan per 50kg for single-season indica rice. Rice must meet grade-3 quality standards, and rice at higher grades gets a premium. A communist party web site posted a Q&A on governmen...

China's National Bureau of Statistics blames its data problems on conspiratorial fraud between the local officials and companies that report data to Beijing. In a May 2020 campaign to crack down on fraudulent statistics an NBS official complained that fraud and fake reporting of data remained rampant in some regions and warned that inspectors are being sent out to local government offices and companies to catch the fraudsters. This was a continuation of a crackdown on statistical fraud and deceit ordered by Xi Jinping in 2021 . In July 2022 statistical inspectors were sent to China's agriculture ministry to root out fraud and falsification, punish perpetrators, and demand that all clerks and accountants take seriously the importance of quality statistics. This follows a visit last year. In August, an inspection team conducted a spot check of livestock statistical reporting in Jilin Province where they checked farm records, investigated the reporting system, and lectured loc...

Chinese officials view scaled-up techno-farms as their farms of the future. Small-scale peasant farmers still blanket the countryside, but subsidies are gradually tilting toward big farms.  business propaganda outlet Yicai proclaimed recently that scaling up farming operations is the key to addressing a crisis of chronic low earnings from grain production that undermine incentives. Yicai insisted further that small-scale farms of 10 mu could never improve rural living standards. The  Yicai  article featured the head of a "cooperative" who had acquired 19,200 mu of land through "land transfer" as a technologically adept farmer superior to the small-holder peasants who still dot China's countryside. The cooperative had boosted wheat yields and quality, linked up with a flour manufacturer, and had plans to expand his business even more. Yicai  cited a 5-year-old Farmers Daily article that found 60 percent of China's cropland is farmed by small-scale farmers ...

China's August 2022 CPI report  said pork prices were up 22 percent from a year earlier, the largest increase of any component of the price index. The Statistics Bureau reckoned that the 10-percent increase for the broader meat category contributed 0.32 percentage points to the 2.5 percent year-on-year rise in consumer prices. A year ago, the August 2021 CPI report said pork prices were down 44.9 percent from a year earlier, the largest decline of any component of consumer prices. In August last year, the meat component of the CPI pulled down the 0.9-percent CPI change by 1.2 percentage points.  According to agriculture ministry wholesale market price monitoring, August 2022 pork prices averaged 33.88 yuan per kg (about $2.23 per lb). That was higher than any historical pork price excluding the once-in-a-lifetime prices during Sept 2019 to January 2021 when African swine fever cratered pork supplies.  Data from China Ministry of Agriculture and Rural Affairs market mo...

China's expensive corn is upending agricultural markets in unexpected ways. India banned exports of broken rice last week and imposed a 20-percent export tax on most other types of rice to pre-empt food security risks. Booming demand for broken rice has been blamed on the war in Ukraine as importers sought out replacements for Ukrainian corn. That's true, but China's demand for broken rice has been on the rise for two years, driven by spiraling Chinese corn prices. Customs data show a relentless growth in Chinese imports of broken rice--a type of grain typically used as an industrial or feed raw material and often imported by African nations. China's broken rice imports tripled from about 200,000 metric tons per quarter in 2020 to around 600,000 metric tons per quarter in 2021. With the onset of the Ukraine war, imports accelerated again to 800,000 metric tons in 2022 Q1 and over 1.2 million metric tons in 2022 Q2. Back in 2020, China imported broken rice mainly from V...

A revival plan for China's soybean industry bears all the marks of Xi Jinping's broader "China Dream" of a glorious rejuvenation of Chinese culture and economic leadership. The doctrine asserts that it is now time to throw off foreign domination of an inherently Chinese commodity. China will create a market for soybeans with distinct Chinese features that will pull along suppliers in Eurasia and Africa, with processing led by Chinese companies and with prices determined in Chinese markets.  Economic Daily led off the month of August with a brief article, "Who has the power to set prices for domestic soybeans?" ( reposted on the Chinese commerce ministry's web site ) and followed up with a 12,000-word " Investigation of the Soybean Issue " feature article ( Harbin TV version with photos ). Many articles described the experimental corn-soybean strip-cropping technique rolled out this year. Several addressed non-GMO futures market topics, and the...