Dim Sums: Agricultural Markets in China

China's countryside is gradually turning into a warehouse for the country's aging population and the working-age population shrinks.  The "population pyramid" for China's countryside in 2020 has a hollowed-out base with relatively few people at peak working ages of 15-49. The largest cohort of rural people in 2020 were aged 50-54, with 24 million women and 25 million men in this age group. By contrast there were only 11 million males and 8 million females aged 15-19 in rural China during 2020.  Calculated from China's 2020 population census. Back in 2000, the rural population pyramid had a thicker base of working age people. Folks age 50-54 in 2020 (a baby boom born in the late '60s to make up for the starvation after Mao's "great leap forward") were aged 30-34--at peak working age. There were so many rural people at working age then that underemployment in the countryside was a major concern in the early 2000s. That cohort was also at peak c...

" There's no need to worry about the increase in imported agricultural products ," Chinese State media said earlier this month. The  Economic Daily  article assured readers that "the expansion of agricultural imports is not a bad thing in itself." It needs to be analyzed, authors said.  This endorsement of food imports by the Communist Party-run Economic Daily appears to be an Orwellian reversal of food security propaganda. It was posted on dozens of Chinese web sites, a sure sign that it is official Chinese communist party propaganda, not the product of a rogue commentator.  Economic Daily  authors said that "some people" have baseless worries that "China will be controlled by others if it imports food" and that "foreign low-priced agricultural products will impact the domestic industry." To prove their point, Economic Daily authors pointed out that "these situations have never occurred in over 20 years since entering the WT...

There's much chatter about China falling into deflation after its July 2023 CPI report showed a -0.3 percent year-on-year decline. The food and beverage component of CPI showed a -0.5 percent year-on-year decrease that reflected mainly a crash in meat prices--especially a 26 percent decrease in pork prices from a year ago. Meanwhile, China's Q2 2023 index of farm prices (most recent available) showed a tiny -0.4 percent decrease from last year. Looking at prices of individual commodities from China's grain bureau, ag ministry, and rural market prices shows a falling trend or plateau for many commodities that began early in 2023 as the post-COVID-lockdown recovery narrative began to vaporize. Signs of deflation are surprisingly evident in Chinese ag prices, despite farmers abandoning land, floods, and downward pressure from surging imports.  Chinese soybeans are a clear example. Xi Jinping ordered an increase in soybean production last year to reduce reliance on imported b...

China is pushing food production into its arid northwestern regions as arable land disappears and water tables are tapped out in eastern and central parts of the country. One new initiative aims to turn China's remote northwestern territory of Xinjiang into a new granary for the rest of China. Last year the State Administration of Grain announced that Xinjiang will take advantage of abundant land, water, and good climate to "excavate" the region's grain production potential to go beyond producing enough grain to meet its own needs to become a national granary that produces and stores a surplus for use of the State. The initiative calls for Xinjiang to maintain a minimum 79 million mu of agricultural land--including 63.2 million mu of "permanent basic farmland", to upgrade irrigation, build "high standard fields," develop grain and oilseed industry clusters, and reduce grain waste. The plan aims for grain storage capacity of 1.5 million metric tons...

Torrential rains drenched wheat just before harvest in China's biggest wheat-growing province, causing sprouting and mold problems. Now officials face challenges of buying up low-grade wheat at a price that keeps farmers happy, keeping moldy wheat out of the flour supply, funding wheat purchases after financial coffers were drained by last year's zero-covid policies, and forestalling fraud as vast price spreads open up between different grades and regions. Sprouted wheat in Henan Province. Henan Province had heavy rainstorms during the last week of May, especially in southern and western parts of the province. These were the heaviest rains at harvest time since 1961 according to financial news outlet Cai Lian She . The excessive moisture caused wheat stalks to keel over, prompted wheat kernels to prematurely send out shoots and wet wheat became susceptible to mold growth. Depending on the degree of damage, the sprouted wheat is downgraded and may only be useable as feed. Wheat ...

This year dozens of agricultural officials have come to China to talk about cooperation. A compilation of news reports from the Ministry of Agriculture and Rural Affairs web site shows 29 meetings with foreign dignitaries (full list below), mostly visits with Minister Tang Renjian in Beijing, but also including Vice Minister Ma Youxiang's trip to the western pacific and Australia, regional meetings of Southeast Asian and Pacific Island nations hosted in China, a meeting with Russia on fishing, and a meeting with Latin American diplomats to show off Chinese technology at the Academy of Agricultural Sciences.  China's new friends include many developing countries in Southeast Asia, Central Asia, and Africa. Pacific Islands--Samoa, Solomon Islands, Papua New Guinea and Kiribati--are well represented, reflecting China's hunger for fish, ambitions to control the Pacific right up to Australia's doorstep, and rewards for switching diplomatic recognition from Taiwan to China. C...

An "American food hegemony" (美国粮食霸权) narrative seems to be creeping into official Chinese communist doctrine as Chinese leaders look to create an external enemy--probably to divert attention from their own mistakes on covid, ill-considered support for Russia's Ukraine invasion, soaring debt and youth unemployment.  An October 2022 Economic Daily commentary asserted that, "The shadow of the United States has been behind every global food crisis," and accused the U.S. of being the "black hand behind the scenes" in the current "global food crisis."  According to the narrative, the United States disingenuously promotes free trade in agricultural goods while abusing its monopoly power to create global food crises in 1978, 2008 and 2022 in order to cement its dominance and control over other countries.  Pieces of the food hegemony story have been rattling around in China for two decades and are now being formed into a standard narrative. Elements...