The outbreak of war between Russia and Ukraine on February 24 has created an enormous diplomatic challenge for China and had a significant impact on various aspects of the nation’s economy and development. Ahead of the 20th National Congress of the Chinese Communist Party in the latter half of the year, when Xi Jinping is expected to secure a historic third term as the country’s leader, a key concern for China is the war’s impact on the its food security and, by extension, its stability.
In recent years, despite the central government’s emphasis on the importance of domestic food production, China’s food imports have been rising and are likely to continue to grow. Chinese policymakers have expressed concerns that the country relies on too few agricultural products and suppliers, particularly from the United States. As part of its food security strategy, China has been increasing efforts to diversify imports to reduce its reliance on the US, boost domestic agricultural production, overcome domestic production deficits and meet growing domestic demand. However, the Russia-Ukraine war will likely hinder such efforts.
Although self-sufficiency remains at the core of China’s food security strategy, the focus has shifted from achieving that goal in grains (rice, wheat, corn, soybean and root tubers such as potatoes, and coarse grains) to ensuring basic self-sufficiency in cereals (wheat, rice, and corn) and absolute security in staples (referring to rice and wheat). The overriding objective of China’s food security is to safeguard the country’s rice and wheat supplies. Compared with rice, the importance of wheat as the second staple is often overlooked. Globally, China is the largest wheat-producing country in the world and is reported to have the largest wheat reserve globally, representing over half of the worldwide wheat stock in 2022. China’s current wheat production accounts for over 17 percent of the global total. In recent years, however, the effects of climate change, including extreme weather causing disasters such as severe flooding, have put domestic production of wheat and other grain crops at risk and have caused production deficits.
Despite its huge domestic production and massive wheat stock, China is also one of the world’s leading wheat importers, purchasing nearly 10 million tons of wheat last year. The obvious reason for this is the large gap between domestic and international wheat prices, but the second and more important factor is the structural imbalance in China’s wheat supply: For decades, China’s wheat policies have focused on quantity rather than quality. To a certain extent, the quality of wheat is often sacrificed in favor of quantity. With rising income and shifting food preferences, however, the country now faces a shortage of high-protein wheat.
For years, China’s wheat imports mainly came from Australia, Canada and the US. Because of the trade war with Washington and worsening ties between China and Western countries, Beijing has been trying to diversify the country’s wheat import sources, eyeing Russia and Central Asian countries such as Kazakhstan, which have not only emerged as key exporters in the global wheat market but also have enormous potential for further increases in wheat production.