Wendy Wu, political economy editor at the South China Morning Post, recently highlighted some challenges China is facing in its food security and emphasized the importance of stability leading into the 20th Party Congress.
In 2020, Chinese leader Xi Jinping, speaking at the Central Economic Agricultural Work Conference, "sent a very stern warning" about the lack of substantial breakthrough in seed innovation which can increase crop output, Wu said on an episode of the ChinaPower podcast titled The State of Chinese Food Security. The podcast is hosted by Bonnie Lin, director of the China Power Project and senior fellow of Asian security at the Center for Strategic and International Studies.
"China has always placed great focus on the food security," Wu said to ChinaPower. "Internally, there are some concerns. First is the decline in the farmland acreage and also declining soil quality. It is stressed that innovation, especially the innovation in agriculture, plantation technology and especially the seed industry, is the only effective way to raise domestic food production."
She fell short of labeling it a crisis, according to ChinaPower.
"I don't think there is a food crisis in China," Wu said in ChinaPower. "There is stress to ensure the food security, but the stress does not mean a crisis. The biggest risk is more existing in the plantation area, such as how China can increase or stabilize the grain output."
There was flooding last year in Hunan Province in central China, a large wheat-producing area, ChinaPower reported.
"And later that year, the officials acknowledged that the floods, the extreme weather has posed the difficulties and challenging on the wheat plantation that winter," Wu said in ChinaPower. "And since 2020, the officials have repeatedly warned that natural disasters, extreme weather has become more frequent."
Food security "is one of the important pillar aspects of [Xi's national security strategy]," Wu said in ChinaPower. "When China sees the U.S. inflation was very high at 9% and as well as other advanced economies such as the UK, it's stressed the significance of further stabilizing the domestic production in order to stabilize the prices at a time when China is preparing the important Party's 20th Congress. It has emphasized, and put priority on domestic stability, economically and socially, and especially when China is struggling with economic recovery."
In 2020, the China Academy of Social Sciences’ Rural Development Institute issued a report stating that by the end of 2025, China would experience a grain shortfall of approximately 25 million metric tons, according to the U.S.-China Economic and Security Review Commission. China's food security issues stem from a combination of shifting demographics, decreasing arable land and natural disasters. Since Xi Jinping took power, he has focused on introducing policies that bolster China's food security and reduce food waste.
President Xi has also worked to expand domestic farming and attain new agricultural technologies, including genetically modified seeds. However, the domestic efforts have not been enough, so Xi has been looking internationally for solutions to China's problems, the U.S.-China Economic and Security Review Commission reported. Since the U.S. is a global leader in fields such as animal husbandry and intellectual property related to GM seeds, Xi has targeted the U.S., presenting risks to American economic and food security.
Although almost 20% of the global population lives in China, the country possesses only 7-9% of global arable land, according to the U.S.-China Economic and Security Review Commission. China had 294 million acres of arable land in 2018 and a population of 1.4 billion as of 2020. The U.S. has more than 375 million acres of arable land and a population of 329.5 million.
China's arable land has been shrinking over the last decade due to soil and water pollution, industrial growth and urbanization, the U.S.-China Economic and Security Review Commission reported. As a result, the Chinese have been purchasing American farmland. Fufeng Group, which has ties to the Chinese government, recently purchased 370 acres of land in North Dakota, only 12 miles from the Grand Forks Air Force Base.
Smithfield Foods, the top U.S. pork producer, was purchased in 2013 by the Chinese company WH Group, backed by the Chinese government, according to the U.S.-China Economic and Security Review Commission. Smithfield has helped China protect itself against volatility in its food supply, sending record amounts of pork to China in 2020. China produces and consumes more than half of the world's pork supply every year.
At the beginning of 2020, Chinese investors and Chinese-owned companies owned less than 200,000 acres of U.S. farmland, worth approximately $1.9 billion, Politico reported. The CCP has a goal of controlling its food supply chain, which has led to Chinese purchases of companies such as Smithfield Foods.
China experienced a record-breaking heatwave this summer, which negatively impacted crop growth, threatened livestock and could harm China's economy, CNBC reported. Dan Wang, chief economist of Hang Seng Bank China, said the heatwave "will affect those big energy-intensive industries, and it will have [a] knock-on effect throughout the economy and even to the global supply chain. We already see a slowdown in production in the steel industry, in chemical industry, in fertilizer industry. Those are very important things when it comes to construction, to agriculture and also to manufacturing in general."
China will assemble its political leaders for the 20th National Congress of the Chinese Communist Party in November 2022, where Xi Jinping will vie for a third term as chairman, The Heritage Foundation reported.
