More rice imports set to hit Chinese farming
China’s increasing import of rice will further hurt its domestic rural farming industry, already ravaged by the COVID-19 pandemic and devastating floods this year, an expert says.
The Chinese, which imported 4 million tonnes of rice a year, bought 100,000 tonnes from India this month, the first time in three decades after shunning Indian rice over what they said were quality issues.
India reportedly offered US$30 less per tonne than China’s traditional rice suppliers Thailand, Myanmar and Vietnam, according to Chinese financial news outlet FX168, quoting the Reuters wire agency.
One Chinese expert said that increasing imports of rice would deal another blow to farmers who had been suffering under COVID-19 and the summer floods.
Buying rice from Vietnam, even with a 65% tariff for exceeding import quotas, would still be far cheaper than growing it themselves, according to Ma Jianlei, an associate researcher at the Agricultural Trade Promotion Center under China’s Ministry of Agriculture and Rural Affairs.
The switch to importing rice in recent years had led to a surplus in the locally grown crop, Ma said. The net profit for Chinese-harvested rice dropped from 15.10 yuan (US$2.30) per 50 kilograms in 2012 to a meager 0.2 yuan (3 US cents) in 2016. In 2018, rice farmers were operating at a loss, leading many to quit the industry altogether. Coupled with China’s rapid urbanization in recent years, the decline in rice planting had affected the stability of food production, Ma said.
Earlier this year, concerns arose about a possible food shortage due to flood disruptions in large parts of central and southern parts of mainland China, followed by the pandemic.
Chinese officials have repeatedly sought to reassure the public by saying there is no food shortage and that rice production will begin in full swing by February. Agricultural minister Han Changfu stressed that an incentive compensation mechanism was in place to protect farmers and their land to ensure a stable output.
Analysts believe a major overhaul is needed to help turn around China’s rice planting industry, such as by improving rice growing technology and fully implementing the mechanization of planting to reduce labor and production costs.
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