China is the next concern as food prices soar

PINGGU, China — From village to village, wheat harvests in China have been erratic this season.

A field on the flat plains east of Beijing was uneven, with knee-high emerald stems in some places, nearly bald elsewhere, damaged by torrential rains last fall. In the next village, a luxurious crop of wheat was thriving after the bright sunshine of that spring and the slow, soaking rains.

China’s winter wheat harvest next month is one of the big uncertainties in a global economy already struggling with high commodity prices, especially in crop-dependent regions of Russia and Ukraine. If China’s harvest fails in the coming weeks, it could drive up food prices even further, deepening hunger and poverty in the world’s poorest countries.

Global food prices have already risen sharply, with wheat up almost 80% since July.

It was a perfect storm of war and time.

Russia’s invasion, including a blockade of ports, has disrupted supplies from Ukraine, a major grain exporter long known as Europe’s breadbasket. The United Nations World Food Program last week called for the immediate reopening of Ukrainian ports, “before the current global hunger crisis spirals out of control”.

Energy prices have risen since before the war, prompting many fertilizer producers to slow down or shut down their plants. As fertilizer costs soar, many farmers around the world are using less, contributing to smaller harvests.

Bad weather added to the challenges. It has been scorching hot this spring in India, a major wheat exporter, while drought has hurt crops in the southern Great Plains of the United States and in East Africa.

It was a double whammy for countries in East Africa, including Somalia, Kenya and Ethiopia, which rely heavily on Russia and Ukraine for the bulk of their wheat imports. Bread prices have doubled in some areas. The World Food Program warned last Friday that “44 million people worldwide are on the verge of starvation”.

China, the world’s largest wheat producer and consumer, is the next price pressure point.

Last fall’s deluges left the ground so waterlogged that wheat roots could not easily penetrate it, said Ren Ruixia, a 45-year-old farm worker, as she surveyed a field of wheat that seemed to have a bad haircut. The coronavirus shutdowns have also delayed the arrival of fertilizer, she said.

“Right now, it looks like the harvest is definitely affected,” Ms. Ren said in late April. “But it also depends on the weather next month – how much rain we get.”

The adequacy of food supplies has long been a major problem in China, where tens of millions died of starvation in the early 1960s during Mao’s disastrous agricultural experiments. Strictly enforced rules require much of the country’s land area – 463,000 square miles, larger than Texas – to be cultivated. Rural villages are sometimes bulldozed to maintain the national target for cultivated acres.

Xi Jinping, China’s top leader, made food security a priority, especially when commodities became a trade issue with the United States under the Trump administration.

“In the future, the demand for food will continue to increase and the balance between supply and demand will become tighter and tighter,” he warned in a policy speech published March 31 in Qiushi, the main theoretical journal of the Chinese Communist Party. “In addition, the international situation is complicated and serious, and we must always be on high alert to ensure food security.”

In early March, China’s Agriculture Minister Tang Renjian sparked international concern when he said the wheat harvest would be the worst on record because of last fall’s deluge. Other Agriculture Ministry officials issued warnings, but not as pessimistic.

Western experts analyzing satellite photos of the Chinese harvest have generally been less worried than Chinese officials. The US Department of Agriculture estimated last month that China’s wheat crop would be 3% lower than last year.

“I don’t think it’s going to be a disaster, but I don’t think it’s a normal culture either,” said Darin Friedrichs, founder and director of market research at Sitonia Consulting, a product analytics firm. Shanghai base.

Senior Chinese officials have issued pessimistic warnings in the past, especially in 2011, to ensure that lower-level officials pay close attention to the harvest. A global food shortage could make Chinese authorities particularly cautious this year.

China has a large stockpile of wheat for emergencies. But some of the wheat might only be suitable for animal consumption given poor storage, said Joseph W. Glauber, a senior researcher at the International Food Policy Research Institute in Washington.

“The international situation is complicated and serious, and we must always be on high alert to ensure food security – we prefer to produce more and increase reserves,” Xi said in remarks released in late March.

The coronavirus complicates things. Closures this spring have disrupted agriculture in major agricultural areas like Jilin Province. And many families, prevented from leaving their apartments to shop, struggle to find enough food.

Some people have reservations, fearful of facing the same lockdown restrictions. Cai Wenling, a 43-year-old resident of Chongqing, said she bought four gallons of rapeseed oil, nearly 100 bottles of mineral water, four weeks of milk and so much pork, beef and chicken. that his fridge and freezer were full. She still plans to buy another 110 pounds of rice.

“Although I have reservations, I still feel confident in Chongqing’s epidemic prevention.” Ms. Cai said, “For middle-aged people like us, we would be more conservative when looking at things. We have confidence, but preparation avoids perils.

China’s nervousness over its food stocks could spill over into the global supply chain.

China has the largest foreign currency reserves in the world, so it has the ability to buy as much wheat as it needs on world markets. But it could push the price of wheat even higher, making it unaffordable in many poor countries.

The next step for China will come down to harvesting.

In the villages around Pinggu, wheat farmers gave varying assessments. It all depends on the quality of the drainage in their fields, but everyone agreed that the rain last fall had been remarkable.

Rain poured down week after week across China’s wheat belt, drowning hundreds of people in tunnels and along riverbanks. In Pingyao, the centuries-old city walls, made of mud cores, collapsed after being soaked last fall.

Zhang Dewang, a 69-year-old resident of Daxingzhuang village, west of Pinggu, said the wheat in his family’s field was growing quite well. The crop was planted exceptionally late, after the autumnal equinox, the traditional last day for planting in the region.

But in recent years, the weather has stayed warm later, Zhang said, so the wheat has a chance to sprout before winter frosts force it into dormancy.

“The wheat grows so well,” he says. “It is going well.”

Claire Crazy, Liu Yi and Li you contributed to the research.

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