How Can Food Security Be Guaranteed? Establishing a New Concept of Food Security Is Key

Before 2004, China's grain self-sufficiency rate had remained above 95%, but over the past 10 years, the grain self-sufficiency rate has been declining, dropping to around 85% by 2014. It is worth noting that the decline in the self-sufficiency rate was not caused by a decline in grain production, but occurred under the circumstances that grain output achieved “eleven consecutive increases” and exceeded 600 billion kg in 2014. This shows that the decline in China's grain self-sufficiency rate was caused by a sharp rise in grain demand. This gave rise to debate about the concept of food security. Some people are deeply worried about this situation, believing that China's food security has been greatly threatened and that grain production should be increased at all costs to raise the grain self-sufficiency rate. Equating food security with the grain self-sufficiency rate, and believing that the higher the self-sufficiency rate, the safer it is, is the traditional concept of food security.

In recent years, the central government's understanding of food security has changed, proposing the new national food security strategy of “taking self-reliance as the mainstay, basing ourselves on domestic supply, ensuring production capacity, importing appropriately, and relying on scientific and technological support.” This new strategy is a major shift in the concept of food security, which we call the new concept of food security. Compared with the traditional concept of food security, which emphasizes that the higher the grain self-sufficiency rate, the better, this is a major change in understanding.

A 100% grain self-sufficiency rate is of course the safest, but from China's national conditions, this kind of food security is neither economical nor necessary.

First, China's land resources are limited. The per capita arable land area is only 40% of the world average, and high-quality arable land is even scarcer. Arable land of grade three or above accounts for only 27% of total arable land. On the basis of a very high grain self-sufficiency rate, every one percentage point increase in the grain self-sufficiency rate will raise the cost of grain by several percentage points, and the higher the self-sufficiency rate, the more the cost rises in geometric progression. This is the so-called law of increasing marginal cost at work. According to relevant research, China's grain production cost has been on an upward trend since the mid-1980s. The per-mu cost increased 15-fold, with an average annual increase of more than 8%, and the production cost per 100 kg of grain increased 6.7-fold, with an average annual increase of about 6%. On the other hand, China's industrialization and urbanization have not yet been completed, and demand for land will still increase substantially. If each urban resident occupies 100 sq m, then if the urban population increases by 200 million, an additional 2 million hectares of land will be occupied. Industrial construction and the construction of transportation facilities such as roads and railways will also occupy large amounts of arable land. Under such circumstances, if more land is used to produce grain, then land for industrial production and urban development can only be strictly restricted, and industrialization and urbanization will be seriously hindered. Sacrificing industrialization and urbanization to raise the grain self-sufficiency rate by a few percentage points is not worth the loss. What is more, most of China's high-quality grain fields are located in densely populated and relatively economically developed areas, such as the middle and lower reaches of the Yangtze River and the Huang-Huai-Hai region, while areas with poor soil and severe salinization, such as the northwest region, are also sparsely populated and relatively slow in economic development. To maintain a very high grain self-sufficiency rate, developed areas would have to give up industrial and urban development to protect grain fields, which is economically very inefficient.

Second, China is severely short of water resources. Water resources, like arable land resources, are a decisive factor in grain production. Although China is the world's fifth-largest country in terms of water resources, per capita water resources have shown a downward trend year by year. By 2014, it was only 1,993 cubic meters per person, only one quarter of the world average, about three fifths of Japan's, one fifth of the United States', and one sixteenth of Russia's, ranking 104th in the world and listed as one of the 13 water-poor countries. Moreover, with the rapid development of China's industrialization and urbanization, industrial and urban water consumption is growing, crowding out water for grain production and greatly increasing the cost of agricultural water use. What is more, China's water resources are extremely unevenly distributed. The proportion of inland renewable surface water resources in the north is only 19.7%, while the proportion in the south reaches 80.3%. Before reform and opening up, the south was the main grain-producing area and had always shipped grain north. But with economic development, arable land in the south was gradually occupied by industrialization and urbanization, and the comparative benefit of growing grain became lower and lower. As a result, the water-scarce north gradually became the main grain-producing area, and the transport of grain from south to north gradually evolved into the transport of grain from north to south. In order to solve the water shortage in the north, the state built the South-to-North Water Diversion Project, diverting water from the south to the north and then transporting grain from the north to the south. This is an unavoidable result. If an excessively high grain self-sufficiency rate is emphasized, the cost in terms of water resources alone would be astonishing.

Third, because China's per capita arable land is limited, agricultural production is still dominated by small farmers, and the area operated by households is very small. By comparison, family farms in countries with few people and much land, such as the United States, Canada, Australia, Brazil, and Argentina, are enormous in scale, and their labor productivity is dozens or even hundreds of times higher than China's. Given the huge difference in labor productivity, China's grain production cost is much higher than abroad. Even if grain from the United States, thousands of miles away, is shipped to China, the price of imported grain is still 50% or even more lower than the price of domestically produced grain. In addition, rising wage levels in China have sharply increased the labor cost of grain production, also pushing grain costs upward. Facing the dual dilemma of a price ceiling pressing down and a production cost floor pushing up, the more domestic grain is produced, the greater the loss, and the lower farmers' income will be; they may even abandon their fields and let them lie fallow. If the government purchases at high prices, it will greatly increase the fiscal burden and storage pressure. Therefore, importing grain appropriately is much more economical than producing it oneself.

⟦NL> Finally, the pollution caused by agricultural production is becoming more and more serious. To produce more grain, more chemical fertilizers, pesticides, and plastic film must be applied, which leads to declining soil fertility and increasingly serious environmental pollution. In recent years, the “eleven consecutive increases” in grain output were achieved under the heavy use of chemical fertilizers, pesticides, and agricultural film. China's use of chemical fertilizers and pesticides greatly exceeds the world average. According to relevant data, nearly 1/4 of China's land surface soil is polluted to varying degrees by various toxic and harmful pollutants. The types and quantities of pesticide residues are increasing year by year, and grain, livestock products, and vegetables all have quality and safety problems such as excessive pesticide residues.

It can be seen that to maintain a very high grain self-sufficiency rate, China will have to pay enormous resource, economic, and environmental costs. But some people may say that grain is not an ordinary commodity; it is a strategic commodity related to guaranteeing food for 1.3 billion Chinese people, and no matter how great the cost, complete grain self-sufficiency must be ensured. Indeed, maintaining a relatively high grain self-sufficiency rate is necessary, because China's population accounts for about one fifth of the world's population. If the self-sufficiency rate is low, large-scale grain imports would be required, which would cause a huge shock to the world grain market and international grain prices would rise sharply. If those major grain-exporting countries encounter years of major famine and grain production falls sharply, grain prices will not only rise like rockets, but grain shortages will also cause large-scale famine in China and other parts of the world. Therefore, from this perspective, China must maintain a relatively high grain self-sufficiency rate no matter what, in order to ensure food security in China and the world. There is no doubt about this point.

However, maintaining a 100% grain self-sufficiency rate is unnecessary. Appropriate grain imports do not mean that food security has been reduced. Nowadays, many countries in the world have relatively low grain self-sufficiency rates, but they have not experienced food shortage crises. For example, Japan and South Korea have long had relatively low grain self-sufficiency rates, and these have also shown a downward trend. From 1990 to 2011, Japan's grain self-sufficiency rate fell from 22% to 20.3%, and South Korea's grain self-sufficiency rate fell from 35.6% to 25.8%. Yet with such low grain self-sufficiency rates, Japan and South Korea have not felt that there is a problem with food security. European countries such as Italy and Spain also have relatively low grain self-sufficiency rates, and they too have no worries about food security. It can be seen that a high grain self-sufficiency rate does not equal a high food security coefficient, and vice versa.

Some people may worry that if relations between China and other countries in the world deteriorate sharply, or even if extreme events such as war occur, it may be possible to impose a grain embargo on China. This is completely groundless worry! China's territory is so large, and with the significant enhancement of its economic strength, it can be said that no country can impose an effective blockade on China. Moreover, grain production and grain production capacity are two different concepts. Appropriately reducing grain production, letting part of the grain fields lie idle, or switching to other crops while maintaining the existence of grain production capacity, is a new way of thinking for implementing a food security strategy. Once a worldwide grain production reduction occurs, or a grain embargo is imposed on China, we do not need to worry. As long as we maintain a half-year grain reserve, that is enough, and after half a year grain supply can be restored.

It can thus be seen that, whether economically or in terms of necessity, maintaining an excessively high grain self-sufficiency rate is not the optimal choice. Ensuring production capacity and importing appropriately are the best food security strategy. The history of past great famines makes people's fear of food shortages understandable, but times have changed, and the concept of food security must also change with the times.