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Food Security: Aiming for Overall Efficiency

Sep 21-2020   



Cyclically, food security becomes a buzzword in China. It has generated extra attention this year due to trade tensions, the pandemic, as well as the top leadership’s admonition on food waste. An appraisal on food security is not only pertinent to safeguarding grain supply but also concerns grain market reform and the government’s role, says Prof. Lu Feng of the NSD in a commentary.

 

Indices such as grain output, trade, inventory and food consumption can safely lead to the judgment that China enjoys basic food security. In as early as 1980s and 1990s, grain production went beyond meeting survival needs and started to build up a buffer zone. The new millennium has seen a continuous and steady expansion of the buffer zone. Compared with the early years of reform and opening up, food security has made substantial headway.

 

The root cause for such progress lies in market-based institutional evolution, coupled with the development of agricultural technology and other modern inputs. On the demand side, the growth rate has stayed below previous estimates owing to some structural constraints. The dynamics between supply and demand, underlined by structural variables, has constituted favorable conditions for food security. For example, the population was expected to peak out at 1.6 billion but will in fact level off at 1.45 billion.

 

Grain production posted 12 consecutive years of growth from 2003 to 2015, rising from 430 million tons to 660 million tons in that period. Factoring net import, annual grain stockpile maintained at a historic high of 770 to 780 million tons from 2015 to 2019. While cereal import amounted to only 2.5% of Chinese production, soybean import skyrocketed from 10 million tons in 2000 to 82-95 million tons yearly in the period of 2015 to 2019. Soybean import helps China to save on its limited farmland and water resource, yet the high dependency rate on the international market poses risks.

 

The larger the buffer zone for food security is, the more necessary it becomes to pay attention to cost and efficiency targets. Prof. Lu proposes reforming and improving grain circulation mechanism and price interference policy, so as to enhance the overall efficiency of safeguarding food security.

Food Security: Aiming for Overall Efficiency

Sep 21-2020   



Cyclically, food security becomes a buzzword in China. It has generated extra attention this year due to trade tensions, the pandemic, as well as the top leadership’s admonition on food waste. An appraisal on food security is not only pertinent to safeguarding grain supply but also concerns grain market reform and the government’s role, says Prof. Lu Feng of the NSD in a commentary.

 

Indices such as grain output, trade, inventory and food consumption can safely lead to the judgment that China enjoys basic food security. In as early as 1980s and 1990s, grain production went beyond meeting survival needs and started to build up a buffer zone. The new millennium has seen a continuous and steady expansion of the buffer zone. Compared with the early years of reform and opening up, food security has made substantial headway.

 

The root cause for such progress lies in market-based institutional evolution, coupled with the development of agricultural technology and other modern inputs. On the demand side, the growth rate has stayed below previous estimates owing to some structural constraints. The dynamics between supply and demand, underlined by structural variables, has constituted favorable conditions for food security. For example, the population was expected to peak out at 1.6 billion but will in fact level off at 1.45 billion.

 

Grain production posted 12 consecutive years of growth from 2003 to 2015, rising from 430 million tons to 660 million tons in that period. Factoring net import, annual grain stockpile maintained at a historic high of 770 to 780 million tons from 2015 to 2019. While cereal import amounted to only 2.5% of Chinese production, soybean import skyrocketed from 10 million tons in 2000 to 82-95 million tons yearly in the period of 2015 to 2019. Soybean import helps China to save on its limited farmland and water resource, yet the high dependency rate on the international market poses risks.

 

The larger the buffer zone for food security is, the more necessary it becomes to pay attention to cost and efficiency targets. Prof. Lu proposes reforming and improving grain circulation mechanism and price interference policy, so as to enhance the overall efficiency of safeguarding food security.