Why China More Than the War in Ukraine

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Maruf Hassan
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Joined: Sun Feb 12, 2023 10:31 am

Why China More Than the War in Ukraine

Post by Maruf Hassan »

At the start of 2023, the surge in agricultural prices, which marked the year that has just ended, seems to be behind us. The prices of the most affected products, such as cereals and oilseeds, have indeed returned to their level of the end of 2021. The prices of energy and fertilizers have come down from their 2022 peak without however returning to their 2021 level. . This return of prices to lower levels should not, however, make us forget that prices were already very high in 2021, which clearly shows that Russia's invasion of Ukraine was not the primary cause of this crisis. , but an aggravating factor in a tense situation that pre-existed him. The price of cereals was, in fact, 44% higher in December 2021 than a year earlier; the increase was even more dramatic for wheat , the price of which had increased by almost 80% between these two dates. However, in 2021, these levels were already worrying international organizations working on food security , because they were jeopardizing food supplies in many poor countries whose finances were emerging from the health crisis. Maintaining prices at such high levels for more than two years now poses a serious threat to the progress made in food security over the past two decades.

Of course, the causes of these developments are multiple, but one of them, although major, is rarely mentioned: the policy implemented in China to ensure its food security. This took the form of the building up of cereal stocks and the introduction of restrictions on fertilizer exports, measures which contributed to the rise in world prices and the difficulties in getting out of this crisis. Dependent China since 2003 With 18% of the world's population for only 8.6% of arable land in 2020, China faces an almost structural phone number list food security challenge. Especially since its arable land has decreased by 6% from 2009 to 2019 (Ministry of Natural Resources) under the pressure of urbanization and offers a relatively modest average productivity. This delicate situation is aggravated by the pollution of water and soil, particularly salient in the past due to a careless administration. Until the early 2000s, Chinese food consumption was provided mainly by local supplies, trade with the rest of the world being extremely limited.

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China's enrichment has resulted in a transformation of its diet: more calories and protein consumed and more animal products; according to FAOSTAT, in China, the share of protein of animal origin in the total protein consumed increased from 32% in 2001 to 39% in 2018 . As this additional demand could not be satisfied by domestic production, imports of Chinese food products began to increase in 2002, the imbalance between consumption and production even accelerating since 2013, leading China to become the world's largest importer of agricultural and food products in 2012. To these structural transformations was added the episode of the African swine fever epizootic which destroyed half of the Chinese pig herd in 2018. The reconstitution of this herd from 2020-2021 has led China to import many more maize: more than 29 million tons, against never more than 8 million per year before. Such an increase in demand, which corresponded to 2.5% of world production, significantly contributed to the increase in world prices in 2021.
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