China Is Accumulating More Than Half of the World’s Food, Driving Up Prices and Sparking Global Inflation

China: The Asian Giant Spent, Just in 2020, US$ 98.1 Billion on Food Imports. The Result of This Buying Movement Came in the Form of Global Inflation

According to USDA (United States Department of Agriculture) projections, China, the Asian giant, will control 69% of the world’s corn reserves by the first half of 2022, as well as 60% of the rice reserves and 51% of wheat, an accumulation of about 20 percentage points over the last 10 years.

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Since these projections come from China’s greatest rival, the statement could have a suspicious bias. However, the country’s “hunger” is corroborated by statements from the Chinese government itself.

“China currently has food stocks at historically high levels […], which can meet a demand equivalent to a year and a half,” said Qin Yuyun, head of the grains department at the National Food and Strategic Reserves Administration of Beijing, last November.

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China Spent US$ 98.1 Billion on Food Imports Just in 2020

China spent, just in 2020, US$ 98.1 billion on food imports, according to data from the country’s General Administration of Customs.

From January to September 2021, Beijing bolstered its reserves to the highest levels since 2016 by buying more soybeans, corn, and wheat, between two to twelve times more than Brazil and the U.S., for example.

The Accumulation of Food Reserves by the Chinese Government Generated Price Increases and a Surge in Global Inflation

The result of this accumulation of food reserves in China came in the form of inflation: according to data from the Food and Agriculture Organization of the UN, food prices soared by 30% globally in the year. In November, the United Nations’ food index recorded a new 10-year high.

“China’s accumulation is one of the reasons for the price increase,” said Akio Shibata, president of the Tochigi Natural Resources Research Institute, in an interview with Nikkei Asia.