China food security: bumper grain harvest defies year full of challenges, and it could affect global food prices

[beijingwalker]

China food security: bumper grain harvest defies year full of challenges, and it could affect global food prices​

• Record grain yield comes despite delayed plantings, heatwaves and prolonged zero-Covid disruptions
• China appears to be reaping the rewards of policymakers making food security an urgent priority in the face of ‘unprecedented’ problems

Published: 9:30pm, 12 Dec, 2022

Amid rising food-security concerns, China’s grain production has shrugged off devastating droughts, floods and a cornucopia of zero-Covid hurdles this year to register another bumper harvest, according to official figures.

Grain output reached a record high of 686.53 million tonnes this year, up 0.5 per cent over 2021, the National Bureau of Statistics (NBS) said on Monday.

It also marked the eighth straight year that China – the world’s top crop producer and a major exporter – has maintained an annual grain output above 650 million tonnes, as Beijing has stepped up efforts to bolster food security against the backdrop of a looming global food crisis.

A bumper harvest, especially of wheat and rice, is also crucial for China to keep inflation in check, and it could also help suppress rising global food prices.

The record crop yield manifested despite delayed wheat planting last winter, disruptions from Covid-19 outbreaks and environmental woes this year, according to Wang Guirong, a director at the NBS.

In February, Chinese policymakers sounded the alarm about “unprecedented” challenges facing the nation’s food security this year, while prioritising domestic grain production and soybean self-sufficiency in its annual blueprint for rural policies.

Ten months later, Wang says the bumper harvest provides “strong support” in stabilising the economy.

“It has laid a solid foundation for coping with the complex and severe international environment and overcoming various risks and challenges, and it has made positive contributions to stabilising the global grain market and food security,” Wang added.

Even though food security has been high on Beijing’s agenda for a few years, the urgency was further heightened this year as the international prices of staple foods, fertilisers and commodities were driven to record highs in the wake of Russia’s invasion of Ukraine.

Compared with last year, soybean output jumped 23.7 per cent to 20.28 million tonnes, according to NBS data. Corn and wheat output saw small increases of 1.7 per cent and 0.6 per cent, respectively.

But rice output fell 2 per cent to 208.5 million tonnes as a result of heatwaves in the southern region and declining acreage, the NBS said.

This year, the central government issued a one-off subsidy of 40 billion yuan (US$5.75 billion) to grain farmers to boost their incentives and steady the subsidies to corn, rice and soybean producers.

It also released nearly 10 million tonnes of fertiliser reserves in the spring and summer to ensure stable market prices and production, the state-backed CCTV reported on Monday.

It said China’s efforts to turn more arable land into higher-yield farmland also helped stabilise the output this year.

And Chinese farmers and local governments have also been told to cut back on soybean meal in animal feed to reduce imports in the latest effort by Beijing to boost agricultural self-reliance.

Soybean meal is one of the most commonly used protein supplements in animal feed and is produced from the residue left after oil extraction. The by-product has become a major driver of China’s surging soybean imports over the past two decades, which has grown to meet rising domestic meat consumption in the world’s largest pork-consuming nation.

More than 85 per cent of China’s soybean supply was imported last year, with Brazil and the United States being the two largest sources.

From January to November this year, China’s soybean imports totalled 80.53 million tonnes, down 8.1 per cent over the same period from last year, according to Customs data.

According to CN Grain, an agricultural information provider that counts the state-owned China Grain Reserves Corporation among its shareholders, China is likely to further reduce its grain imports this year, largely due to the rising international grain prices.

“In 2022, soybeans will still be the largest imported crop, but the imports of corn and soybean as animal feed are decreasing,” CN Grain said in a blog post last week.

China’s bumper grain harvest defies unprecedented challenges, sets record

The record grain yield comes despite delayed plantings, heatwaves and prolonged zero-Covid disruptions, as China’s policymakers keep food security atop their priorities.

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