China Confronts Possibility Of Steadily Increasing Grain Imports

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BEIJING, Feb 26 (IPS) - With global food prices on an upward spiral, China is facing renewed fears that its growing demand for grain to feed the world’s largest population may lead to imports from international markets, driving prices higher and spurring further food inflation.

The resurging "threat of China’s food security" may have induced more fatigue than alarm if it was not coming at a time of unprecedented scarcity of arable land, which is increasingly being converted to grow biofuels, and because of fresh challenges posed by global warming. With its natural constraints -- it has to feed a fifth of the world’s population with less than one-seventh of the global farmland -- and its surging demand, China finds itself in the middle of a raucous debate about the future of global food security.

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To promote self-sufficiency, Beijing has done away with a policy spanning two thousands years of collecting grain tax from the peasants and has resolved to provide farmers with more subsidised fertilisers and seeds. Reacting to rising global prices and inflation worries at home, China also raised export taxes and imposed export quotas on a range of grains and flour in December. Nevertheless, China’s inflation -- driven by food prices surges, is running at its highest in 11 years. China’s consumer prices in January surged 7.1 percent from a year earlier.

The food situation has been exacerbated by devastating snowstorms in January that have killed farm animals and damaged crops across a large part of the country. Partly because of the storms, China’s food prices in 2008 have risen 18 percent, higher than the 13 percent increase of grain commodities in Indonesia and Pakistan, and well above the 10 per cent increase in South America and other developing countries. The scourge of high prices and natural disasters occurs at a time of rapid loss of arable land, prompting some Chinese analysts to speak of the "global scramble for farmland". While Beijing is said to control the amount of cropland taken over to produce biofuels, in the last decade the country has lost 5.5 percent of its arable land to desertification and industrial expansion.

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http://www.ipsnews.net/news.asp?idnews=41345

[pscot]

1. And who might the exporters be

now that ethanol is worth so much more than bread? Whoops. I forgot. They can afford to pay in dollars.:rofl: