U.S. Secretary of State Antony Blinken just delivered a speech on the Biden administration's China policy with new tactics for investments, alliances and competition at its core. The speech conveyed complicated messages, at once sustaining the ideologically charged blaming of Donald Trump but also identifying a series of potential areas for bilateral cooperation. Blinken for the first time mentioned exploring China-U.S. cooperation on food security. We may have to wait to discover the true intentions behind the proposal, but food security is indeed becoming a prominent subject in international politics as a result of multiple factors. Both China and the United States have significant interests in this area.
Grain prices have risen globally since 2020, and the risk of a grain shortage is emerging. Observers warn that the world is facing another global grain crisis, but one more severe than the crisis in 2010 because of a number of periodic, short-term contingency and long-term structural factors combined.
In periodic factors, frequent extreme weather incidents brought by climate change are again dealing heavy blows to major grain-producing areas all over the world. Sustained draught in the western and southwestern continental United States has affected the output of wheat. Extreme weather has also reduced domestic grain output in places of already low self-sufficiency, such as Africa, Latin America and the Caribbean, thereby increasing their need for imports.
As for short-term contingencies, the Russia-Ukraine crisis has triggered a chain reaction. As the conflict between the world's main grain and chemical fertilizer exporters is prolonged, increasing spillover effects have emerged. First is that constraints on both countries' grain and fertilizer producing capacity, with the supply of corresponding commodities getting tighter. Second is that Western sanctions place Russian exports of grain and chemical fertilizers under long-term pressure, creating a tremendous man-made shortage in global supply. Third is that Western financial sanctions against Russia have limited its oil and natural gas exports, driving up global energy prices. Grain production and transportation are closely linked to the energy and chemical industries and are extremely sensitive to energy prices.
A key long-term factor is that the grain supply is related to the global energy transition. To reach emission reduction goals, countries have increased their input into new energy, but the process has also affected grain production. For instance, benefits from solar photovoltaic power generation may be higher than those from grain-planting and so occupy more farmland. Under subsidy policies, using such food crops as corn to make biofuels may be profitable. And there is the contradiction between carbon emissions from grain production, animal husbandry and national emission reduction goals.
More countries are beginning to highlight domestic food security and adopt protectionist grain policies. More than 20 countries have issued orders to restrict grain exports this year, covering such major staples as wheat, corn and vegetable oils. Such policies have further escalated the panic in grain-importing countries and the international grain market. Africa, the Middle East and Central Asian countries, which are highly reliant on grain imports, face greater pressure than other countries, and systemic risks are more likely in these regions.
Compared with other areas, China and the U.S. have a more desirable environment for cooperation on food security. On one hand, the two have a mutually beneficial relationship in grain trading. China is the largest export market for U.S. agricultural products. In 2021, bilateral trade in agricultural products reached a record $46.4 billion. The grain trade has become important ballast for China-U.S. trade, as well as one of the most important bonds between the two countries. On the other hand, the two countries have a similar understanding about food security. When President Xi Jinping put forward the global development initiative in September last year at the UNGA, food security was listed as one of the eight key areas for cooperation. Neither China nor the U.S. wants to see a humanitarian crisis brought by famine in developing nations.
Based on this status quo and outstanding issues in food security, China and the U.S. may consider cooperation in the following aspects:
• First, work together to oppose the politicization of grain issues and protectionist grain policies. Grain is not only a commodity but also a basic element for human subsistence. In order to guarantee countries' food security, they should refrain from turning grain into a subject of international sanctions or a diplomatic bargaining chip. China and the U.S. may explore collaboration in this area to promote both the production and export of grain by major producing nations, easing the blow to global food security inflicted by the Russia-Ukraine crisis. China and the U.S. may consider making a joint statement on food security at such international forums as the G20, incorporating food security into the field of global macro policy coordination.
• Second, jointly preserve the safety of grain transport channels, and promote trade facilitation and non-discrimination. Countries' grain supplies need trade and transport. Both China and the U.S. have significant interests in the international grain trade, and they can consider closer collaboration to make sure international channels stay safe and reliable at all times. China and the U.S. may promote grain trade facilitation measures at the WTO and further reduce grain losses in the process of trade.
• Third, advocate increased investment in agricultural technologies and tech-sharing to upgrade developing countries' disaster response capabilities. Agro-technological progress is a main route for easing the continuous stress on global grain supplies. Except for a few Western countries, such as the United States and France, the main grain-producing countries are mostly developing ones whose technological capabilities for coping with natural disasters, pests and declining soil fertility are relatively limited. China and the U.S., as major powers in the world, should shoulder greater responsibility for coping with such global crises. They should work together to promote cooperation in research and development, promote agro-technologies, preserve the stability of global grain production and guarantee food security during the global energy transition.
