China’s Increasing Food Imports: The Impact on Global Markets

3 September 2014 FDI Team


China’s imports of cereals have increased dramatically in 2014, despite almost achieving self-sufficiency in the past decade. China’s food consumption is changing and increasing, which, considering China’s growing middle class, will have significant and lasting consequences on the global food market.


Since the 1990s, China’s demand for food has dramatically increased. In 2010, for example, the Chinese consumed 65 million tonnes of soybeans, compared to ten million tonnes in 1990. Increases in the domestic production of soybeans fell far behind the growing demand over the same period however, leaving a gap of ten to 15 million tonnes. To meet domestic demand, China is now a net importer of rice and wheat. This forced China to abandon its grain self-sufficiency policy earlier this year. It is likely to become the world’s largest importer of agricultural products by 2020 and is already changing the face of global food markets.


China imported 80 per cent more cereals between January and July 2014 than in the same period last year. While cereal imports constitute only five per cent of China’s grain consumption, this share is projected to rise in line with demand. This calls into question China’s food security policy, which aims for a return to self-sufficiency in grains by 2020.

A combination of rapid urbanisation, a growing middle class, increasing incomes and changing dietary patterns, have led to greater food demand in China. The 1.35 billion Chinese are becoming richer and increasingly urbanised. Consequently, China’s growing middle class has shifted to a new diet, including more meat, eggs and wheat and dairy products, in addition to traditional grain staples. Grain consumption in China is close to double what it was 30 years ago (approximately 445 kilograms per person per year). This is largely a result of rising meat production which has increased the amount of grain consumed by livestock.

China is struggling to meet its domestic food demand. Production is lagging and the supply of basic food is expected to be insufficient by 2050. Challenges in the agricultural sector are the main impediments to China’s ability to respond to the growing food needs of its population.

Agricultural challenges include limited available land, scarce resources and rising input costs. Pollution issues are rife, in particular soil contamination; approximately 20 per cent of the agricultural land is polluted. This will force large areas of agricultural land to lay fallow, out of production, for an extended period.

Climate change is also affecting the availability of agricultural resources. Rivers are drying up and droughts are becoming more frequent. Extreme weather, insect infestations and diseases are increasingly common, creating difficult growing conditions. These agricultural constraints are adding to other concerns over lead, cadmium and arsenic contaminated food. Consequently, the Chinese are increasingly looking to overseas sources for safer and better quality food.

The rise in Chinese imports could have positive outcomes for Australia. Australia is renowned for its safe and high quality food produce and could help to meet the Chinese demand by increasing its exports. Indirectly, increases in Chinese food imports could also increase Australian exports to other countries; the decline in Chinese exports is creating a widening supply gap that Australia could fill. The Department of Agriculture, Fisheries and Forestry perceives it as a great opportunity for Australian farmers.

Any change to China’s domestic food supply, however, could also have negative global implications. For example, the drought in 2011 generated global inflation in food prices. Similarly, China’s accelerating position as a net importer of food could have a lasting impact on price inflation. This results in higher prices for consumers outside China and potentially, food insecurity and vulnerability.

Shenggen Fan, Director of the International Food Policy Research Institute (IFPRI), sees an opportunity to enhance global food security. China could try to diversify its import sources. The developing Latin American and African markets could supply food to China, resulting in a positive outcome for all parties: a stable supply ensured for China and access to the Chinese food market for those countries. What is clear, however, is that China becoming a net importer of basic food commodities is a game changer for global food markets; an opportunity to be seized by other countries.

Soazic Heslot   
Research Assistant
Global Food and Water Crisis Research Programme

Any opinions or views expressed in this paper are those of the individual author, unless stated to be those of Future Directions International.

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