appConfigEntityId

bodyType

customContents

entityId

entityUuid

isVideo

articlePageQuery

article

articleSchemaContent

content

hooksArticlePageAdvertisementConfigArticle

hooksArticlePageFloatingButtonConfigArticle

appConfig

filter

json

liveArticle

Sherry Wang

A surge in global agricultural prices has sparked fears of a global food crisis in recent weeks. But China’s limited reliance on staple grain imports and robust domestic reserves should cushion the blow of any external shocks, analysts said, though unpredictable weather, geopolitics and US-China trade tensions could still pose risks.
The assessment comes as Beijing steps up efforts to diversify grain trade with other countries. On Saturday, China and Kazakhstan launched a grain trading platform in Changsha, Hunan province. The head of China’s National Food and Strategic Reserves Administration, Liu Huanxin, said the platform was crucial to ensuring regional food security.
Global grain prices have risen sharply in recent weeks, with Chicago corn, soybean and wheat futures reaching multi-year contract highs in late August and early September, according to CME Group. Meanwhile, the UN Food and Agriculture Organisation’s food price index climbed to 131.1 points in July, its highest level since January 2023.
The rally was driven by a combination of factors. The escalation of the Russia-Ukraine war has disrupted grain exports via the Black Sea, while the US-Israeli war on Iran continues to disrupt shipping through the Strait of Hormuz. An El Nino cycle projected to be one of the strongest in decades has also raised worries over the stability of global grain supplies.
Argus, an international energy and commodity price assessment agency, said disruptions in the Black Sea had been the main driver of the recent rally. Daily exports through Ukrainian ports have plunged to about 20,000 tonnes, down from more than 180,000 tonnes under the former Black Sea Grain Initiative, according to the agency. The initiative began in 2022 to ease grain exports through the sea but collapsed the following year.
The disruptions came during the peak export season from July to September, forcing buyers in Europe, North Africa and the Middle East to seek alternative supplies from North America, South America and Australia, and pushing up prices globally.
Those higher global prices have also begun to reach China. The cost-and-freight price for November shipments of US Gulf corn to China had reached US$330 per tonne on Friday, up more than US$30 per tonne from early August, according to Argus assessments.
However, analysts said the impact on China’s broader food market would remain limited, particularly compared with more import-dependent economies.
“China is relatively well insulated from a global food-price shock compared to import-dependent Asian economies because it produces most of its staple grains domestically and maintains sizeable reserves,” said Sheana Yue, an economist at Oxford Economics.

Argus said the direct supply impact on China appeared relatively limited, as China did not rely heavily on Black Sea corn imports. “While higher international prices may influence domestic market sentiment, price transmission into China is likely to be more moderate and potentially shorter lived than in some other markets.”
That resilience is underpinned by China’s large domestic grain harvests. Argus said current market indicators suggested domestic grain availability in China remained relatively comfortable.
“Based on currently available weather data, conditions across key growing regions have generally been favourable, reducing the immediate need for additional overseas purchases,” the agency said.
China’s summer grain harvest exceeded 150 million tonnes for the first time this year, while early rice output remained above 28 million tonnes for the sixth consecutive year, official data showed.
But China’s insulation is far from absolute.
One key area of exposure is soybeans, with China relying on imports for more than 80 per cent of its consumption. Yue described soybeans as the “bigger vulnerability”, saying a sustained rise in global soybean prices would be more likely to “feed through indirectly via livestock-feed costs and meat prices than through a sharp increase in staple food inflation”.
In addition, “domestic weather disruptions remain an additional risk, particularly for corn and soybeans”, Yue said.
Argus said market participants would be closely watching September’s weather patterns as China’s corn harvest progressed.
Attention would also focus on developments surrounding the Black Sea grain corridor, while changes in China-US trade policy, including tariffs, could influence import purchasing decisions for feed grains, the agency said.


Geologists find unexpectedly large water sources in Xinjiang beneath China’s largest desert

Why China’s sugar stockpiles may blunt an El Nino-fuelled global supply crunch

China has 1.4 billion mouths to feed. How vulnerable is it to a global food crisis?

Amid food security concerns, China passes first law on farmland protection and improvement

China food security

A harvester operates in a corn field in northeast China’s Heilongjiang province on Wednesday. Photo: Xinhua

Workers process soybean plants in Jinzhou, northern China’s Hebei province, on August 18. Photo: AFP

China rejects G20 trade-imbalance claims, says no need to devalue yuan

Officers stand guard in front of the headquarters of the People’s Bank of China in Beijing. Photo: Reuters

As oil tops US$97, US-Iran war escalation has markets bracing for supply risks

A customer pumps gas at a petrol station in Katy, Texas in the US on August 17. Photo: AFP

PetroChina’s first-half profit jumps 22% as higher oil prices offset Iran war supply hit

The PetroChina logo is displayed on a smartphone screen. Photo: Shutterstock

China and Iran sanctions: what US moves mean for Beijing, and its retaliation options

US President Donald Trump (right) walks with President Xi Jinping in Beijing on May 15. Photo: Evan Vucci/Pool via AP

As US threatens ‘D-Day’ for Iranian economy, how will China’s oil supply be affected?

A US guided-missile destroyer blocks an Iran-flagged crude oil tanker attempting to sail towards an Iranian port on April 24. Photo: AFP

An oil tanker unloads imported crude at Qingdao Port in Shandong province on April 4. Photo: Getty Images

Economy

Global Economy

China Economy

El Nino fears and disruptions to Ukraine’s grain exports are driving up global crop prices, but China’s robust supplies temper the impact


El Nino fears and disruptions to Ukraine’s grain exports are driving up global crop prices, but China’s robust supplies temper the impact.


China has 1.4 billion mouths to feed. How vulnerable is it to a global food crisis?

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}El Nino fears and disruptions to Ukraine’s grain exports are driving up global crop prices, but China’s robust supplies temper the impact

El Nino fears and disruptions to Ukraine’s grain exports are driving up global crop prices, but China’s robust supplies temper the impact