Food security does not rely on Sinograin, so what does it rely on for protection?

With grain in hand, the heart is at ease. This is the core idea of our country's grain policy. It sounds fine, but unfortunately the real world has costs. The first problem is that grain prices are pushed up, and our country has become a high-price zone in the international grain market. From wheat and corn to rice, despite output climbing year after year, China's grain prices are not only higher than those of the United States, but also higher than those of Vietnam, Thailand and other countries. Many grain processing enterprises import grain from abroad, and the cost is instead lower. This is also the main reason for the surge in China's grain imports in recent years.

Another cost of storing large amounts of grain is that the grain grows old year after year, and what processing enterprises buy from grain depots is mostly old rice. Grain depots release grain on a first-in, first-out basis: new grain comes in, old grain goes out, and the older it is, the more urgently it must be sold. Many grain depots across the country have stored grain for several years, and the situation is even more serious in Northeast China; some are said to have stored rice from six or seven years ago.

With long-term large grain inventories, it is simply impossible not to breed corruption. Scandals at Sinograin occur almost every year, and when a "big rat" in the granary is involved, the amount is in the tens of millions. In 2013, a suspicious fire also broke out at Sinograin's Lindian grain depot, and 78 open-air grain storage bins and 47,000 tons of grain were reduced to ashes, shocking the whole country. Some time ago, CCTV also exposed that grain depots and grain traders in Liaoning and Jilin colluded, using old grain to substitute for new grain and pocketing the price difference. Sinograin has long been an independent little kingdom at the local level, and such incidents are certainly not few.

Does China really need to store so much grain? To answer these two questions, one must truly understand the issue of food security.

The most common saying is that China is a country with a huge population, so many people need to eat; what if there is a grain shortage? In fact, contrary to people's intuition, it is precisely because China has a large population and a vast market that grain is safer. One major factor causing grain production declines is climate, and the broader the market, the smaller the fluctuations in grain output and grain prices. A village may look self-sufficient, but its grain price fluctuations are far greater than those of the national market. Given China's vast territory, a climate disaster causing nationwide grain production declines is almost impossible.

The impact of modern agriculture on grain output depends to a greater extent on intensive cultivation and scientific farming. Although the number of farmers keeps decreasing, both per-unit grain yields and total output keep rising. In the long run, Chinese people can only eat more and more fully and better and better, and the possibility of a food crisis is too small.

Some people also say that China is, after all, a major country; once there is a grain shortage, who in the world can supply it? Professor Chen Zhangliang also said at the Boao Forum that if food security is not taken seriously, and all the world's agricultural products are bought by us, what will others do? Some people are even more worried that if the international situation changes and the grain market closes, relying on imports would make it easy for others to "grip us by the throat."

These claims are completely baseless worries. First, China has always been a major agricultural country, and its import volume was limited to begin with, so how could it "buy all the world's agricultural products"? If the Chinese people's purchasing power increases greatly and they import large amounts of agricultural products from the international market, that is precisely a good thing. A self-sufficient country usually goes hungry, while importing large amounts of grain from the international market often means other industries are more profitable. As long as there is money in hand, buying grain from all over the world becomes worthwhile. No country's agriculture in the world can monopolize the international market, and a blockade is even more absolutely impossible. Using the war-preparedness thinking of "dig deep caves, store grain widely" to respond to an open international environment can only make the country suffer unnecessary losses.

Therefore, to ensure food security, we should abandon the war-preparedness thinking of "with grain in hand, the heart is at ease" and view food security from a market-oriented perspective. There are grain futures on the market, which use prices to guide grain reserves at every link. Once a production decline is expected, prices rise, and grain processing plants, warehouses, supermarkets, grain stores and even housewives will all increase grain storage, other forms of food supply will increase accordingly, and imports and exports will also adjust accordingly. In modern society, this reaction speed is only a matter of a few days. If grain storage is left to the entire market, how much storage is appropriate? Heaven knows; just look at prices.

To put it bluntly, China's food security is a severely exaggerated problem. Not only is there completely no problem now, but even if Sinograin did not purchase and store grain, Chinese people would not go hungry. The so-called "food security warning line" proposed by the International Food and Agriculture Organization - the ratio of grain ending stocks to annual consumption must not be lower than 17% - is itself full of planned-economy thinking. China's publicly announced grain storage is 35%, and according to conservative industry estimates it may already have reached 40%. This is not only unnecessary, but has also caused serious waste.

If grain reserves are needed, they should also be limited to military affairs, disaster relief and relief aid, which was precisely one major function of ancient official grain. This special grain storage for emergency disaster relief is obviously much smaller in scale. One major function of today's Sinograin is to stabilize the grain market and ensure food security, but in fact these can all be handed over to the market.