China will provide 10 billion yuan ($1.45 billion) in one-time farm subsidies, according to a government statement on April 17. The subsidies are meant to help grain farmers. Funds will be deposited directly to farmers’ bank accounts, according to a report in Chinese state media the Global Times.
However, experts believe despite recent subsidies, the incentive for Chinese farmers to engage in crop production remains low. Further, it is unclear how much of the money will actually reach farmers.
Connections Are Everything
The latest round of subsidies are meant to support spring farming and motivate farmers, according to an article in state media Xinhua News.
In recent years, China has heavily subsidized its farmers. Last year alone, China issued three subsidies, for a total of 40 billion yuan ($5.81 billion), to support and encourage grain production.
However, a Chinese journalist told The Epoch Times he suspects the actual amount going to farmers will be low.
The journalist used the pseudonym Mr. Huang for fear of reprisal. He said he is concerned that embezzlement due to China’s “corrupt bureaucracy” will divert the funds from their intended recipients.
In just one example, a 2017 investigation uncovered at least 730 million yuan that had been misappropriated from the country’s poverty-relief initiative.
Huang said the so-called direct deposit to farmers’ bank accounts was just an announcement. In fact, whether farmers actually get subsidies depends on their connections to local authorities.
“Under the regime’s ruling, nothing is open, fair, or just,” he said. “A good connection will get you the subsidies, even if you’re not a farmer; a bad connection will get you nothing, even if you’re a farmer.”
Workers are seen next to a truck unloading harvested soybeans at a farm in Chiping County, Shandong Province, China on Oct. 8, 2018. (Reuters)
Food Security: China’s Longtime Focus
“Food security has been an emphasis of the regime’s No. 1 Central Document for years,” said Scott Y. Lin, director of the Graduate Institute of Development Studies at Taiwan’s National Chengchi University. However, while the subsidies are meant to encourage farming and secure food sources, Lin believes the reality may be different.
Since 2004, the so-called “No. 1 Central Document,” the first policy statement issued by Beijing’s top echelons each year, has centered on food security and three rural development issues: agriculture, rural areas, and farmers.
Mr. Wang (a pseudonym), a farmer from China’s northern Hebei Province who turned to migrant work to make ends meet, told The Epoch Times that individual farmers simply can’t afford to farm full time.
“They'd rather lease their land to large growers,” he said. “The large growers can get more subsidies.”
Wang thinks his family will receive some of the subsidy money, but he is not overly optimistic. “Ordinary farmers won’t get much,” he said.
Wang pointed to haphazard agricultural development under corrupt authorities as one reason for the regime’s grain shortage. “They cut down all the trees for growing crops, even those just planted for a couple of years. Some people grow crops by the lake,” he said.
Recent research shows that the cost of labor, land rental, and farming tools has made it hard for farmers to make ends meet.
Young farmers are increasingly leaving rural areas to find more lucrative employment as migrant workers, according to an investigative report on farming in Raohe County, a base for soybean production. Millions of migrant workers power the factories and commerce of China’s cities, sometimes making as much in one year as an entire family’s farm income.
The report, detailed on Chinese news portal Sina Finance, said “The annual income of a family’s farming is not as good as the income of one person going out to work, resulting in a large number of rural laborers going out to work.”
Looking Toward a Food Shortage
To compensate for the loss of domestic farmers, Lin said, “China has been importing more and more soybeans and corn.”
China recorded imports of 11.989 million tons of grain in March of 2023, according to an April 14 report by AskCI Consulting, an industry research supplier. China imported 38.727 million tons of grains from January to March, a year-on-year increase of 4.7 percent.
China’s food self-sufficiency rate has been declining steadily over the past 20 years, averaging a decline of at least one percentage point annually. That rate of decline is higher than that of Japan, South Korea, or Taiwan, according to a report in state media The Paper. By 2020, China’s grain self-sufficiency had dropped to 76.8 percent and is expected to drop even further—to 65 percent—by 2035, according to the report from January 2022.
Chinese researchers warned that China may experience a food shortage of about 130 million tons by 2025, according to the 2020 China Rural Development Report.
Haizhong Ning and Luo Ya contributed to this report.
