Can the United States feed China?

[Tiki Tam Tam]

Can the United States feed China?

By Lester R. Brown, Friday, March 11, 11:42 AM

China is at war. It is not invading armies but expanding deserts that threaten its territory. As old deserts grow, as new ones form and as more and more irrigation wells go dry, Beijing is losing a long battle to feed its growing population on its own.

In the years to come, China will almost certainly have to turn to the outside world for grain to avoid politically destabilizing price spikes. Enter the United States — by far the world’s largest grain exporter. The United States exports about 90 million tons of grain annually, though China requires 80 million tons of grain each year to meet just one-fifth of its needs.

Just as China is America’s banker, America could become China’s farmer. Such a scenario — to be dependent on imported grain, much of it from the United States — is China’s worst nightmare and one that could create nightmares for U.S. consumers, as well.

The evidence of China’s plight is clear. Since 1950, some 24,000 villages in the northwestern part of the country have been totally or partially abandoned as sand dunes encroach on cropland. And with millions of Chinese farmers drilling wells to expand their harvests, water tables are falling under much of the North China Plain, which produces half of the nation’s wheat and a third of its corn.

Chinese agriculture is also losing irrigation water to cities and factories. Cropland is being sacrificed for residential and industrial construction, including highways and parking lots that accommodate China’s voracious demand for automobiles. In 2009, automobile sales in China totaled just under 14 million, surpassing those in the United States for the first time. For every 1 million cars added to this fleet, at least 50,000 acres are paved over.

And China’s food supply is already tightening. In November, its food price index was up 12 percent from 2009. The price of vegetables alone was up 62 percent.

In these conditions, how do you feed more than 1 billion people? This question vexes China’s leaders, many of whom are survivors of the Great Famine, in which 30 million people starved to death between 1959 and 1961. Last year, in an effort to halt rising food prices, the government auctioned corn, wheat, rice and soybeans from state reserves. And in recent years, China has bought or leased land in other countries from Sudan to Indonesia to produce food and biofuels, but there is little to show in production from these lands so far.

If China, which imported about 2 million tons of U.S. corn and wheat combined in 2010, charges into the U.S. grain market, American consumers will find themselves competing with nearly 1.4 billion foreign consumers for the U.S. grain harvest. This would raise the prices not only of products made directly from grain, such as bread, pasta and breakfast cereals, but also of meat, milk and eggs, which take large quantities of grain to produce. Corn futures have already hit $7 a bushel, up from $2 a bushel five years ago. In that same period, soybean futures climbed from $6 a bushel to $14 a bushel, and cattle and hog futures hit all-time highs.
China has been here before — with soybeans. In 1995, around the time the Communist Party prioritized grain production, China produced and consumed 14 million tons of soybeans. By 2010, China was still producing 14 million tons of soy annually, but consuming 69 million tons. For the nation that domesticated the soybean, the change was dramatic, and it resulted in the restructuring of agriculture in the Western Hemisphere. To meet overseas demand, the United States now has more land in soybeans than wheat. Brazil has more land in soybeans than in all grains combined. And Argentina is fast becoming a soybean monoculture. Today, nearly 60 percent of world soybean exports — almost all from these three countries — go to China.

Of course, when selling food to China, the United States is dealing with both an economic competitor and a creditor holding $900 billion worth of U.S. Treasury securities. If China pushes U.S. food prices higher, tensions between the two countries may escalate. An even greater stress may develop between Washington and U.S. consumers, as Americans — who think cheap food is a birthright — are likely to press for restrictions on exports to China. There is precedent for this: In the 1970s, the United States banned exports of soybeans to countries such as Japan to quash domestic food price inflation.

Though withholding food from an emerging superpower could lower domestic food prices, it would be bad diplomacy. Even during the Cold War, the United States exported 10 million tons of wheat — nearly a quarter of the U.S. harvest — to the Soviet Union in 1972 after a crop failure there. Well-fed enemies are more predictable.

Would this work today? The Obama administration — or any future administration — faces a choice. If we limit grain sales to China, might the Chinese limit their monthly purchases at Treasury securities auctions? What would happen to farmers who can’t sell to the world’s largest food market? We can’t know how this tension will play out politically, but we do know that our huge deficits of the past 30 years restrict our bargaining power.

The United States has been the world’s breadbasket for more than half a century. Our country has never known food shortages or spiraling food prices. But, like it or not, we will probably have to share our harvest with the Chinese, no matter how much that raises our prices.

Our world is about to change. In the supermarket checkout line, in restaurants and at Federal Reserve meetings, it’s hard to imagine that it will be for the better.

Lester R. Brown is president of the Earth Policy Institute and the author of “World on the Edge: How to Prevent Environmental and Economic Collapse.”
Can the United States feed China? - The Washington Post

This article raises interesting issues.

The issue of desertification of China, if the details given that 24,000 villages in the northwestern part of the country have been totally or partially abandoned as sand dunes encroach on cropland. And that millions of Chinese farmers drilling wells to expand their harvests, with water tables are falling under much of the North China Plain, which produces half of the nation’s wheat and a third of its corn, is true, then it sure raises concern.

Indeed if Chinese agriculture is losing irrigation water to cities and factories and cropland is being sacrificed for residential and industrial construction, including highways and parking lots to accommodate China’s voracious demand for automobiles, it is for the Chinese to have a re-look at the pace of modernisation and take necessary action to balance development with necessary food production. It does cause alarm to note that for every 1 million cars added to this fleet, 50,000 acres are paved over.

If China’s food supply is tightening and in November, its food price index was up 12 percent from 2009. And the price of vegetables alone was up 62 percent, then it is rather high compared to the rest of the world, which too is facing similar problems.

If the effort to halt rising food prices, the government had to auctioned corn, wheat, rice and soybeans from state reserves, it does not auger well in the long run. However, China’s buying or leasing land in other countries from Sudan to Indonesia to produce food and biofuels is a step in the right direction even if there is little to show in production from these lands so far. It will take time I presume.

However, the question that arises is that if the countries where China has bought or leased land are unable to meet their own domestic need, it will cause starvation there or, if the govt in those countries are autocratic with little regards to international norms, they might even nationalise the land and cause problems for China.

Likewise, if China imports grains from the US as it did when it imported about 2 million tons of U.S. corn and wheat combined in 2010, swamps the U.S. grain market, it will cause the American consumers competing with nearly 1.4 billion foreign consumers for the U.S. grain harvest. This would raise the prices not only of products made directly from grain, such as bread, pasta and breakfast cereals, but also of meat, milk and eggs, which take large quantities of grain to produce. Corn futures have already hit $7 a bushel, up from $2 a bushel five years ago. In that same period, soybean futures climbed from $6 a bushel to $14 a bushel, and cattle and hog futures hit all-time highs. Therefore, the US will be constrained to not export leading to a crisis of sorts in China.

The crux of the issue for the US is it faces a choice. If the limits grain sales to China, it might the Chinese limit their monthly purchases at Treasury securities auctions. What would happen to farmers who can’t sell to the world’s largest food market? One can’t know how this tension will play out politically, but one does know that the huge deficits of the past 30 years will restrict the US’ bargaining power.

 

[twoplustwoisfour]

And yet, the US continues to provide it's farmers with huge direct subsidy? Isn't by doing that the US government subsidising food for the Chinese??

 

[cross1993]

1# China does have land desertification, but China did very well to elimination desertification, Our total amount of Desert Land in reducing the annual.
According to the present rate of decrease, after 300 years, China will not have Desert Land.
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2# China's grain production is almost all by themselves. 2010, China imports less than 15 million tons of grain, it is less than 1% of 2010 food consumption of Chinese.
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3# China has a policy of "farmland cordon", Chinese law stipulates that China can not be less than 1.8 billion mu of farmland.
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Chinese law stipulates that China must be more than three years of grain reserves.
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4# If the USA to stop selling food to China, we will purchase the food in France and Canada and Australia.