China’s solutions to food security since 1949
Agricultural experts doing field research in a rice paddy Lianyungang, Jiangsu Province Photo:JS93
Food security has been a core concern of China’s agricultural policy. Since 1949, the interests of stakeholders have remained central to the country’s food policies as it hopes to address the pressure of food production and sale. These policies touched upon land, trade, circulation, production and population. In 1984, for the first time since 1949, China had surplus grain due to its soaring food output, meaning that people could get enough food to eat. Therefore, in this article, China’s food policy consists of two phases: before the year 1984 and after.
How to have enough to eat
China focused on producing enough food for its people between 1949 and 1983. During this period, its grain output experienced a spiral growth, with per capita food production rising from 209 kg to 376 kg.
In 1950, China’s land reform stimulated farmers’ enthusiasm for grain production, secured farmers’ interests and greatly increased grain output. The pressure on the country’s food security had been eased. However, grain was in short supply despite the increased output. The tight supply-demand relationship led to sharp fluctuations in market prices. In 1952, to stabilize grain prices and markets, free trade gave way to planned grain purchase and supply. China’s food sector had entered the era of unified purchase and sale. This policy reflected the central government’s efforts to protect urban consumer interests and stabilize grain prices. It also eyed more initial capital accumulation for industrialization.
Starting in 1959, China suffered three years of famine. To address this famine, China adopted multifaceted policies. In terms of trade policy, the central government, facing the food security crisis, imported grains for the first time to protect consumer interests and ensure market stability. Some policies targeted the population. Given the tight market, the famine affected many farmers. After weighing all stakeholders’ benefits, the country found that the only way was to mobilize urban residents to move to the countryside, thus reducing the population in cities.
After the reform and opening up, to increase farmers’ enthusiasm for grain production, the country established the household responsibility contract system, which greatly elevated labor productivity. In 1978, the central government began to gradually adjust the policy of unified grain purchase and sale. After completing the national procurement task, people could buy and sell small amounts of grain and oil in local markets. The grain departments could trade grain. Market forces gradually played a bigger role and influenced a larger scope.
From 1984 to the present, China has focused on making sure people eat well. After providing people with enough food and clothing, the government began to consider how to improve the quality of agricultural products based on ensuring grain output. In 1984, China for the first time encouraged farmers to work in cities, so farmers had the autonomy and choice to engage in non-agricultural occupations. During this period, the national policy gradually tilted towards narrowing the gap between urban and rural areas and further protecting farmers’ interests.
In 1985, farmers found it difficult to sell grain for the first time since 1949. The substantial increase in grain output caused an oversupply, which in turn reduced grain prices. This phenomenon benefited consumers, but it hurt farmers’ interests and their enthusiasm for grain production. At the outset of industrialization, the country decided to implement contract-based orders, as unified purchase and sale no longer fit the national situation. Meanwhile, China began to gradually lift restrictions on the grain market, allowing farmers to freely buy and sell surplus grain. The adoption of contract-based orders and free trade formed a dual-track grain price system.
The dual-track grain price system, however, decreased farmers’ income. Many farmers started to cut down on land for growing grain, resulting in a slump in grain production in 1985. Therefore, the country had to switch back to the unified purchase and sale policy. Meanwhile, China reduced the quantity of contract-based grain orders to develop the market economy while the quantity of negotiated purchases rose. During this period, the grain supply could feed the Chinese people. Amid rapid economic development, the urban industrial and commercial sectors demanded more laborers. In 1984, the country allowed the free movement of laborers so they could seek jobs in cities to support themselves.
In the early 1990s, higher grain purchase prices pushed grain output to increase year by year, but the dual-track price system imposed a huge financial burden on the government. In 1993, China announced the formal establishment of a grain-purchase price protection system to further protect farmers’ interests and national grain security. The system prevented the abandonment of farmland and ensured land for grain, promoting the stable growth of grain output. Since 1994, the state further relaxed restrictions, no longer setting grain purchase prices while maintaining the number of state orders. This move helped to avoid the phenomenon of purchase prices being higher than selling prices.
From 1997 to 1999, China’s grain production reached a new high. In 1999, China’s grain stocks hit 288 million tons, far exceeding reasonable levels, and farmers again had difficulty selling grain. In the second half of 1999, the central government decided to modify the agricultural production structure and again reduce grain growing areas.
The “Agreement on China-US Agricultural Cooperation” signed in April 1999 also further marketized China’s agricultural products. The agreement allowed high-quality agricultural products to enter the domestic market, intensified the competition among domestic agricultural products, strengthened the role of the market mechanism, and conformed to urban consumers’ interests.
Grain land
In the context of domestic surplus grain, low food prices and the opening of the domestic agricultural product market, China released a “restoring farmland to forest” policy to protect the ecological environment and realize sustainable development. Its implementation helped improve the environment, reduce grain yield and eliminate the excess grain supply across the country. In the long run, the policy aimed to tackle the continued low grain prices, protect the interests of farmers and lay the bedrock for reducing the losses of state-owned grain enterprises.
Amid the structural adjustments of agricultural policy, China’s grain output has continuously declined due to the decrease in land for planting grain. In terms of production, the country increased investment in agricultural infrastructure. Regarding circulation, it formulated a supporting policy called the direct grain subsidy in 2004. In the past, China provided subsidies to grain circulation so that state-owned enterprises would purchase farmers’ surplus grain at protective prices. The policy called upon governments to provide subsidies directly to farmers whose enthusiasm for planting grain would grow in turn.
Meanwhile, China has worked hard on its land system. The Law of the People’s Republic of China on the Contracting of Rural Land came into enforcement on Jan. 1, 2003. The law regulates a series of acts regarding land contracts and protects farmers’ interests.
Since 2004, China’s urbanization has accelerated. The rapid urbanization has put forward new requirements on how to ensure food security in the new era. Against this backdrop, in 2006, based on careful calculation considering future population growth and technological development, China proposed the goal that its farmland would remain at or above the red line of 120 million hectares at the fourth session of the 10th National People’s Congress.
Grain security
Amid the COVID-19 pandemic, many countries’ restrictions on grain exports have worried people about food security. The pandemic may cause food shortages in some countries that rely heavily on exports. China can guard its food security as it is less dependent on the international market.
China for years has supplied over 95% of its grain need. It harvested 663.9 million tons of grain in 2019, an increase of about 6 million tons from 2018. Also, its food stocks are ample, remaining much higher than 17–18% of annual consumption, the safety stock level set by the Food and Agriculture Organization. Furthermore, the country’s wheat and rice stocks are equivalent to its annual consumption, according to the recent data from the Department of Development Planning under the Ministry of Agriculture and Rural Affairs.
Besides, China doesn’t rely too much on the international market. It maintains a high level of self-sufficiency regarding staple foods throughout the years. Its supply of soybeans, corn and other grains depends on imports; however, in recent years China has continuously expanded its sources for soybean imports. Despite export restrictions, soybeans are not China’s primary grain. Currently, the state reserves are sufficient to secure price stability.
Wei Baolong and Gao Xuwen are from the China Academy for Rural Development at Zhejiang University.
edited by MA YUHONG