Can China's food security situation be free from worry?

In recent years, China's grain has shown a phenomenon of "simultaneous increases in all three quantities" - output, imports and stocks. Grain supply has been stable, but new situations, new problems and new challenges have continued to become more prominent. Ren Zhengxiao, director of the State Administration of Grain, said in a speech today at the inaugural meeting of the National Food Security Policy Expert Advisory Committee that the current high stocks do not mean that China's food security situation is free from worry. It is necessary to correctly analyze the new situations and new problems facing food security, accurately grasp the trends in grain supply and demand and their underlying laws, and effectively strengthen the foresight, targeting and effectiveness of grain work, which is of great significance for ensuring national food security.

Since 2004, China's grain production has achieved "twelve consecutive increases," grain demand in all respects has been continuously and reliably guaranteed, and the overall grain supply and demand situation is good. But in the long run, with China's continued population growth and the upgrading of the consumption structure, grain consumption will also grow rigidly. At the same time, the rigid constraints of factors such as arable land, freshwater resources, effective agricultural labor and the carrying capacity of the ecological environment on grain production are becoming increasingly prominent, and it is becoming increasingly difficult to further stabilize and increase grain output. A tight balance between grain supply and demand will be a long-term trend. In addition, factors such as international politics, geopolitical conflicts, and the financial and energy attributes of grain are also increasingly deepening their impact on food security. Maintaining a balance between grain supply and demand and ensuring domestic market supply allow no room for optimism.

Ren Zhengxiao believes that China's current food security situation remains complex and severe. Although grain stocks are at a historical high, this is unsustainable. Once the domestic and international economic situation and the grain market situation change, grain stocks may decline rapidly. We must never conclude that China's grain situation is already free from worry simply because of the current high grain stocks.

At present, the main contradiction in China's grain sector is no longer a contradiction of total quantity, but a structural contradiction. The main aspect of the contradiction lies on the supply side, prominently manifested in the obvious phased oversupply of corn and rice, the widening gap between soybean production and demand year by year, and insufficient supply of high-end quality products. Serious inventory backlogs put enormous pressure on grain purchasing and storage, safe grain storage and fiscal burden. At the same time, some deep-seated contradictions and problems of an institutional and mechanistic nature in the grain sector have become more visible, bringing severe challenges to safeguarding national food security. Supply-side structural reform in the grain sector is extremely urgent. We must unswervingly advance supply-side structural reform in the grain sector, accelerate "de-stocking" of grain, adjust the structure, strengthen weak links, build up strength and increase vitality, so that the grain supply system better adapts to changes in the demand structure.

Ren Zhengxiao believes that at present, supply-side structural reform in the grain sector should focus on the following aspects: first, actively explore new models of market-oriented purchasing and reform and improve the grain purchasing and storage system; second, vigorously develop the grain industry economy to meet new diversified, personalized and customized food consumption needs; third, accelerate the modernization of grain circulation capacity to achieve efficient, convenient and orderly grain circulation and ensure military and civilian food supply; fourth, break through key and difficult points and accelerate the digestion of unreasonable grain inventories.

The domestic grain market is now highly linked to the international market. For some time to come, with the accelerated development of economic globalization and trade liberalization, and with the in-depth advancement of national opening-up strategies such as the "Belt and Road," the trend of China's economy becoming deeply integrated into the world economy will become more obvious, and the accelerated integration of domestic and international grain markets is the general trend. "To safeguard national food security, we must maintain strategic resolve, adhere unswervingly to the principle of relying mainly on ourselves and ensuring basic self-sufficiency in grain based on domestic production, and at the same time establish a global perspective, find the right points of integration into the international grain market, actively and effectively make good use of both markets and both types of resources, and accelerate the formation of mutually beneficial and win-win international cooperative relations, so as to both ensure national food security and fulfill the mission of a major country in safeguarding global food security," said Ren Zhengxiao.

Grain has both the attributes of an ordinary commodity and certain public-welfare and foundational characteristics. In a large developing country like ours with a huge population, grain is of even more special importance. In order to ensure national food security and farmers' interests, since 2004 the state has successively implemented policy-based purchasing and storage for some grain varieties. The grain market has formed a continuously firm policy-driven market, which played a crucial role in promoting the development of grain production in the short term, but is difficult to sustain in the long term.

Ren Zhengxiao believes that safeguarding food security must insist on giving prominence to the role of the market and better playing the role of the government. To achieve a higher-level and higher-quality food security, we must follow market laws, fully give play to the decisive role of the market in allocating grain resources, and be good at using market mechanisms to solve problems. Wherever the market can play a role, the government should try not to intervene. But this does not mean that the government should do nothing. Wherever the market cannot effectively play a role, the government should take the initiative to fill the gap. What should be managed must be resolutely managed, managed thoroughly and managed well. In grain work, how to achieve overall coordination, complementary advantages, organic combination and coordinated efforts in these two aspects is a major issue before us.