China not stocking up on grain, instead it is destocking it

A foreign media outlet recently accused China of hoarding grain on a large scale and maliciously jacking up food prices, leading to famine in some countries and global food shortage.

After the outbreak of COVID-19, some foreign media outlets had claimed that “Chinese demand” triggered the rise in food prices globally. All these media outlets ever do is blame China for the rise in global food prices and the global food crisis.

In 2021, China registered a bumper grain harvest for the 18th consecutive year, with total grain output exceeding 650 million metric tons for seven consecutive years. The harvest ensured the country’s basic self-sufficiency in grain and its absolute grain security. China does import some grain, but that is mainly to make up for its structural grain shortage and to optimize its grain supply structure. This is a necessary adjustment based on China’s high grain output and is not at all about hoarding grain.

Also, given that China mainly purchases second-hand grain from the four major international grain traders, it does not influence the global food trade or international food pricing. The rise in global food prices since 2020 is the result of a variety of factors, including the continuous spread of the novel coronavirus pandemic, frequent occurrence of extreme weather events, excess global liquidity, and speculation by international capital.

As a grain buyer, China has always procured grain in line with standard international trade rules and on the basis of its domestic demand and supply, and there is no hoarding of grain or forced buying and selling. China is fully aware of the limited volume of the global grain trade, so when importing grain, it takes into full consideration the world’s grain supply capacity and ensures its relatively stable scale of imports to avoid sudden and massive imports from affecting the world’s food security.

At present, China has sufficient grain stocks, with the ratio of stock to consumption far higher than the international food security warning line. The two grain stocks of rice and wheat are enough to feed the whole country for more than one and a half years. A sufficient grain stock is the “ballast” for China to ensure its food security in the event of any “black swan” or “gray rhino” events. Therefore, China has not hoarded grain, but only accelerated its grain destocking.