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Why China Imports Wheat

Published online by Cambridge University Press:  17 February 2009

Feng-Hwa Mah
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The early 1960s witnessed significant changes in the commodity structure of Mainland China's international trade. One of the most striking developments during these years was that China became a net food importer, whereas in the 1950s, when Russia was her most important trading partner, China had been a net exporter of foodstuffs, and roughly one third to one half of China's exports to the Soviet Union had consisted of processed and unprocessed food. These exports were reduced to a mere 3 to 5 per cent, of China's total exports to Russia during 1961–63. Accompanying this change was a pronounced increase of China's imports of food from western countries. During 1952–60, China's purchase of “cereals and cereal preparations” had accounted for but 1 per cent, or less of her total imports from the West. This was augmented to approximately one-half of total imports in 1961–63, about one-third in 1964–66 and roughly one-fifth in 1967. The single most important item of the imported food has been wheat, amounting to four to five million metric tons a year since 1961, and coming mostly from Canada, Australia, Argentina and France.

Type
Research Article
Information
The China Quarterly , Volume 45 , March 1971 , pp. 116 - 128
Copyright
Copyright © The China Quarterly 1971

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References

1 According to my calculations, Sino-Soviet trade accounted for 37 to 54 per cent, of China's total trade during 1950–60.

2 Based on Soviet official foreign trade statistics.

3 With the exception of 1955. In that year such import was 4 per cent, of the total. Unless otherwise noted, all Sino-Western trade data in this paper are taken from or computed on the basis of data in U.S. Department of Commerce (USDQ, Summary Tables Showing Exports to and Imports from Soviet Bloc Countries by Free World Countries, 1952–1967Google Scholar. The term “West” is used in this paper as equivalent to “non-Communist countries.”

4 Wilson, Dick, “Interview with Chen Ming,” Far Eastern Economic Review (FEER) Hong Kong, 21 05 1964, p. 367.Google Scholar

5 U.S. Department of Agriculture (USDA), Foreign Agriculture Service, Foreign Agriculture, 07 1965, p. 4.Google Scholar

6 Donnithorne, Audrey, China's Grain: Output, Procurement, Transfers and Trade, Occasional Paper, No. 2 (Economic Research Center, The Chinese University of Hong Kong, 1970), pp. 2, 12 and 20.Google Scholar

7 Wilson, Dick, FEER, 21 05 1964Google Scholar. The bracketed query and the italicization are mine.

8 Based on data in USDC, Summary of Country-by-Commodity Series: Free World Countries' Imports from Communist Areas, tables for 1960–1967Google Scholar. The original data are western import returns valued c.i.f.; 10 per cent, of the reported values is deducted for freight and insurance charges. The total figure includes values of Chinese exports of soyabean, rice, wheat, barley, com, rye, malt and “other and unspecified cereals and cereal preparations,” if any.

9 Chinese exports of food-grain to Russia in the 1960s were negligible. Data on Chinese exports of food-grain to Eastern European and Asian Communist countries are inadequate. Chinese exports of rice to Cuba were as follows (in 1,000 metric tons):

(Sources: Peking Review, 14 01 1966, p. 22, and 4 February 1966, p. 16Google Scholar. The 1967 figure is this author's estimate.)

At the average price of about $140 per ton, the total value of Chinese rice exports to Cuba for these six years would be approximately $125 million. However, these exports did not yield any foreign exchange proceeds for China, as the rice was exchanged for Cuban sugar. Any imbalance in favour of China would have been financed by a long-term “economic co-operation” loan which China extended to Cuba on 30 November 1960, or by trade loans as a form of Chinese aid to Cuba. See ibid. 14 January 1966, p. 22.

10 This Agreement was still in force in 1969 according to the new barter pact between China and Ceylon, signed 8 January 1969. See China Trade Report (Hong Kong), 01 1969, p. 6.Google Scholar

11 Donnithorne, , China's Grain, p. 2.Google Scholar

12 See Communist China Map Folio (Washington, D.C.: Central Intelligence Agency, 1967), page on Railroads.Google Scholar

13 Ibid, page on Roads and Inland Waterways. More than one half of the roads were of natural earth.

14 Transport cost based on the estimate in Table I, col. (7).

15 See Donnithorne, , China's Grain, pp. 8–9 and 14Google Scholar. The quotation is from p. 14.

16 See ibid., p. 12.

17 For example, the remark, “At a Central work conference, whoever holds the largest stock of the food crop can outtalk anybody else,” attributed to Chu, T'ao, appeared in Fan-hsiu chan-pao (Anti-Revisionist Combat Bulletin) (Canton), 8 07 1967Google Scholar, and is cited by Donnithorne, Audrey, China's Grain, p. 22.Google Scholar

18 Perkins, Dwight H., “Industrial Planning and Management,” in Eckstein, Alexander, Galenson, Walter and Liu, Ta-chung (eds.), Economic Trends in Communist China (Chicago: Aldine Publishing Company, 1968), p. 621.Google Scholar

19 Ibid. p. 631.

20 Wu, Yuan-li, The Economy of Communist China (New York: Frederick A. Praeger, 1965), p. 27.Google Scholar

21 Walker, Kenneth R., Planning in Chinese Agriculture (Chicago: Aldine Publishing Company, 1965), p. 87. The brackets are mine.Google Scholar

22 For 1966 and 1967 imports, see Table I. The 1968 import of wheat was 3·8 million metric tons (The Economist, 13 12 1969, p. 42)Google Scholar. When order was returned in 1969, wheat import went up to about 4·6 million tons (Current Scene, 1 06 1970, p. 15).Google Scholar

23 Including grain for food, seed, animal fodder and industrial uses. The figure is taken from Jones, Edwin F., “The Emerging Pattern of China's Economic Revolution,”Google Scholar in U.S. Congress, Joint Economic Committee, An Economic Profle of Mainland China (90th Cong., 1st Sess.) (Washington, D.C.: Government Printing Office, 1967), Vol. I, p. 81Google Scholar. During 1952–57, non-food uses accounted for 16·3 to 21·7 per cent, of total grain output (Liu, Ta-chung and Yeh, Kung-chia, The Economy of the Chinese Mainland: National Income and Economic Development 1933–1959 (Princeton: Princeton University Press, 1965), p. 132)CrossRefGoogle Scholar. Apply the lower percentage to the per capita grain requirement of 300 kilograms, we obtain the per capita per year food requirement of 251 kilograms, which is practically equal to the traditional Chinese subsistence standard of 250 kilograms as reported in Hsiao-tung, Fei, Earthbound China (Chicago: University of Chicago Press, 1945), p. 158.Google Scholar

24 Cf. last section, this article. Donnithorne also noted that the per capita figure and its implications may be quite different. We can identify the high grain output figure for 1967 (230 million tons) as the one given by Anna Louise Strong in her Letters from China (Reported by Tanyug on 29 01 1968)Google Scholar. This is actually a prediction made by Strong before the end of 1967. The 1967 population of 713 million used by Donnithorne is close to the 712·2 million for mid-1968, which is the sum total of the population figures of 29 provinces and municipalities announced by the New China News Agency during 1967–68 along with the inauguration of Revolutionary Committees in thse localities (see China News Summary, Hong Kong, No. 242 (10 10 1969), p. 5)Google Scholar. Compared with the 1953 census figure of 582·6 million, the mid-1968 figure implies a compound rate of annual increase of about 1·4 per cent, for the 15-year period; this is too low, judging from officially reported rates of population growth.

25 Including the figures for 1958–65 given privately by officials of the Chinese Ministry of Agriculture to a visiting Pakistani delegation in 1965. For these figures, see Swamy, Subramanian and Burki, Shahid Javed, “Foodgrains Output in the People's Republic of China, 1958–1965,” The China Quarterly, No. 41 (01–03 1970), p. 62.Google Scholar

26 These estimates are made by O. L. Dawson, E. F. Jones, W. Klatt and the U.S. Agricultural Officer stationed in U.S. Consulate-General, Hong Kong, respectively. For some of the discussions of the relative merits of these estimates, see Field, Robert Michael, “How Much Grain Does Communist China Produce?”The China Quarterly, No. 33 (01–03 1968), pp. 98–107Google Scholar; Liu, Ta-chung, “Further Observations,” in Ho, Ping-ti and Tsou, Tang (eds.), China in Crisis (Chicago: The University of Chicago Press, 1968), Vol. 1, Book Two, pp. 681–684Google Scholar; and Perkins, Dwight H., “Comments,”Google Scholar in Ho, and Tsou, (eds.), China in Crisis, pp. 661–664.Google Scholar

27 Dawson's estimate is higher than the reconstructed Chinese estimate for 1960–63 and close to it for 1964–65 (see Jones, E. F., in An Economic Profile of Mainland China, p. 93)Google Scholar. The use of the Dawson estimate here for illustrative purposes does not imply that it is a better estimate than the others.

28 See Liu, and Yeh, , Economy of the Chinese Mainland, pp. 45–46, 52.Google Scholar

29 The per capita food consumption for 1960–65, calculated at 84 per cent, of Dawson's grain output figures, ranges from 199 kilograms to 231 kilograms a year.

30 Including Shansi, Shensi, Hopei and Shantung. New China News Agency (Peking), 28 09 1967.Google Scholar

31 China's cultivated land continued to increase from 1950 to 1957. In the peak year of 1957 it was 111·89 million hectares (based on data in Ten Great Years, p. 128)Google Scholar. In 1963 the total cultivated land was reported to be 106·70 million hectares (quoted in Jones, , in An Economic Profile of Mainland China, Vol. I, p. 82)Google Scholar. This would indicate a reduction of 5·19 million hectares. Even when compared with the 1950–57 average of 107·99 million hectares (computed from data in Ten Great Years, p. 128)Google Scholar, the 1963 total acreage was 1·23 million hectares less.

32 For example, a report in the People's Daily of 5 04 1962Google Scholar criticized “blind expansion of water conservation work” which led to large-scale alkalization in the North. See also the People's Daily of 29 08 1969.Google Scholar

33 See People's Dally, 30 03 1961Google Scholar and Ta-kung pao (Peking), 23 09 1963.Google Scholar

34 The per-unit wheat yield in the 1950s was officially reported as follows (in metric tons per 1,000 hectares): 1950–57 average, 790; 1950–58 average, 823; 1952–57 average, 822 (based on annual data in Ten Great Years, p. 121)Google Scholar. Estimated wheat yield in the 1960s can be found in col. (3), Table III. For 1962–67, for which outside estimates are available, the per-unit wheat yield was higher each year than the three averages given above. The 1962–67 average wheat yield according to the data in Table III would be 910 metric tons per 1,000 hectares.

The official data of China's wheat production in the 1950s are (in million metric tons): 1950–57 average, 20–33; 1950–58 average, 21–29; 1952–57 average, 21·86 (based on annual data in Ten Great Years, p. 119)Google Scholar. The 1962–67 average wheat output was estimated to be 22·72 million tons (Current Scene, 31 03 1969, p. 9)Google Scholar. It is not the purpose here to comment on the various existing estimates of China's grain production. But it may be mentioned that the estimates made by the United States Agricultural Officer in Hong Kong, appearing in Current Scene, 31 03 1969, pp. 8–10Google Scholar, may be slightly downward biased. It is believed that possible margins of error in the above quoted figures will not influence the argument developed here.

35 Calculated on the basis of rice production data in Current Scene, 31 03 1969, p. 9Google Scholar, and rice export data in Table I, the rice export ratio was 0·7 per cent, in 1962; 0·8 per cent, in 1963, 1964, 1965; 1·1 per cent, in 1966, and again 0·8 per cent, in 1967.

36 This is the average for 1962–67, computed from the wheat import data in Table I and the estimated wheat production data in Current Scene, 31 03 1969, p. 9.Google Scholar

37 Communist China (Issues in United States Foreign Policy, No. 4), Department of State Publication 8499 (Washington D.C.: U.S. Government Printing Office, 12 1969), p. 17.Google Scholar