FACTBOX: China's food security push blown away by fierce typhoons in 2023

At a time when China urgently needs steady domestic agricultural supplies, fierce typhoons have battered the country and disrupted its food security push in 2023.

Since the summer of this year, powerful typhoons, infamously know as super typhoons have dealt a severe blow to China's agricultural infrastructure and caused massive floods in key farming regions. The first to hit the Asian nation this year was typhoon Talim, which made landfall on July 18, causing extensive damage to farmlands in the southern parts of the country. Since then, China has endured three more typhoons, Doksuri, Khanun and Saola.

Typhoons typically bring torrential rainfall in its path and beyond, leading to severe flooding and large-scale damage to agricultural regions. In China's case, its northeastern region was one of the worst affected areas amid incessant rainfall and floods. The region is vital to Beijing's food security initiative as its agricultural output constitutes a sizable chunk of nation's total grain production.

Not surprisingly, China's Ministry of Agriculture and Rural Affairs has repeatedly said in its reports that typhoon-led heavy rains and flooding are expected to severely impact the country's food production in 2023.

Infrastructure

** China is one of the world's largest grain producers. But the country is also the biggest importer of agricultural products, making its food security push extremely vulnerable to foreign factors.

** Several disruptions to food supply in the past few years, such as COVID-19 pandemic, US-China trade dispute, Russia-Ukraine war have forced Beijing to focus on enhanced domestic production and self-sufficiency in agricultural supply chain.

** President Xi Jinping has conflated China's food security with national security. "We will fall under others' control if we don't hold our rice bowl steady," he said in March.

** However, achieving self-reliance in food supply is likely to be a herculean task for China amid challenges, such as global warming-led natural disasters, limited arable land and ever-rising domestic demand for food consumption.

** Global warming has made China extremely vulnerable to natural calamities, such as typhoons, droughts and floods.

** Weather extremes in 2023 have severely impacted the country's key food producing regions, especially the north-east, Ministry of Agriculture and Rural Affairs said.

** The three northeastern provinces – Heilongjiang, Jilin and Liaoning – account for more than one fifth of the country's total grain output of 650 million mt.

** Northeastern region of China, which produces over 40% of the country's corn, is also the top producer of soybeans and rice.

** According to the US Department of Agriculture, China is forecast to produce 277 million mt of corn in the marketing year 2023-24 (October 2023-September 2024), steady on the year. The country's wheat and rice outputs are projected at 137 million mt, unchanged on the year and 149 million mt, up 2% on the year, respectively.

** China's soybean production in MY 2022-23 is expected at 20.5 million mt, steady on the year, the USDA data showed.

** However, amid back-to-back bouts of fierce typhoons and other severe natural disasters, China's MY 2023-24 agricultural production forecast is likely to be revised down, market analysts said.

Trade

** China depends immensely on foreign food supplies, raising questions on its efforts to become self-sufficient in agriculture. Natural disasters make the country that much more vulnerable to acute food shortages and inflationary pressures.

** Over 10 million acres (4 million hectares) of cropland has already been hit by natural disasters in China so far in 2023, up 1.3 million acres from the same period last year, Ministry of Agriculture and Rural Affairs said in August.

** China is the world's largest importer of soybeans, corn, rice, wheat, sorghum, barley, beef and pork.

** According to the latest report from the General Administration of Customs, between January and August, China has imported 71.65 million mt of soybeans, up 18% on the year and 9.56 million mt of wheat, up 59% on the year.

** The country has imported 14.91 million mt of corn between January and August, down 12% on the year and 2.57 million mt of edible palm oil, up 118.57% on the year. It has also purchased 2.02 million mt of rice, down 55.8% on the year and 6.2 million mt of barley during Jan-August period, up 54% on the year.

Prices

**China has yet to be impacted by higher import prices as Brazil's record harvest of soybeans and corn, and Russia's robust production of wheat have kept a lid on prices this year.

** Platts, part of S&P Global, assessed SOYBEX CFR China for November deliveries at $569.25/mt Sept. 20, up $1.19/mt day on day.

** Platts assessed APW wheat FOB Australia at $299/mt Sept. 20, up $2/mt on the day.

** Platts assessed CIF New Orleans corn for September deliveries at $222.55/mt Sept. 20, which is $2.35/mt higher on the day.