Focus on China - OECD-FAO Agricultural Outlook 2013-2022


China will improve its food security and remain self-sufficient in main food crops while increasing trade in selected commodities.

China: Self-sufficiency for major commodities
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With comparatively little agricultural land and water resources, China has made food security and self sufficiency in the key food crops of rice and wheat a top policy priority. Agricultural output grew 4.5 times over the 1978-2011 period following agricultural and rural reforms. However, food price inflation has been rising in recent years, and output is anticipated to slow in the next decade with increasing resource and rural labour constraints.

Increased availability of food and higher incomes have improved food security significantly with the number of undernourished falling by almost 100 million since 1990, despite adding an additional 200 million people to its population. Reducing the estimated 158 million number of persons still undernourished remains a major challenge.

From 2001 to 2012, China’s agricultural trade (imports and exports) increased from USD 27.9 billion to USD 155.7 billion. Import dependence doubled from 6.2% to 12.9% with China’s net trade deficit in agriculture and food standing at USD 31 billion in 2012.

It is projected that China’s consumption growth will slightly outpace its production growth by some 0.3% p.a., similar to the trend of the previous decade. As a result, a further but modest opening of China’s agricultural sector is anticipated although these prospects vary by commodity.

The government has instituted a policy to prevent any further exit of land from agriculture while the 12th Five-Year Plan sets specific targets for area and production of wheat, rice, coarse grain, soybeans and tubers. This Outlook affirms indicates that these targets should be met or exceeded in the next decade.

China’s imports of oilseeds are expected to rise by 40% over the 2013-22 period, accounting for 59% of global trade. Sugar imports should stay above the tariff rate quota level over the projection period.

Cotton area is projected to decline 21% as cotton use declines with the intensification of competition in textiles from India and other countries with lower labour costs. This trend of decreasing cotton utilisation use is a reversal from the last decade.

Livestock, both the meat and dairy sectors, will continue to expand, with increasing feed requirements which will result in higher imports of coarse grains, likely beyond the current tariff quota levels. China is expected to become the world’s leading consumer of pigmeat on a per capita basis, surpassing the European Union by 2022.

Milk production should exhibit considerably slower growth while dairy product consumption is expected to increase 38% by 2022, with fresh dairy products responsible for most of this growth. Dairy imports are projected to rise 20% with skimmed and whole milk powder accounting for 82% of total dairy imports.

China should maintain its leading role in global fisheries as its aquaculture as production continues to increase, albeit at half the rate of the previous decade. China is expected to account for 63% of global aquaculture production in 2022 and remain one of the world’s leading fish exporters.