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China’s Efforts To Produce GM Corn Could Be Hampered By Price Volatility And Soil Quality

With plans to start cultivating genetically modified maize this year, China, which grows more corn than any other nation, hopes to increase food security and lessen its reliance on imports.

Yet, given the burden placed on soil health and the limited amount of arable land, it can be several years before the intended outcome is realized. This could result in China relying more on grain imports if its own production costs get too high or if the price of grain from abroad drops again.

Although GM acres will likely make up less than 1% of the overall corn area, Beijing last week approved the planting of GM maize this year. China announced on Tuesday that it would broaden the scope of its GM agricultural trials, which have long been met with resistance in the nation.

In China, almost all of the arable land is already under use and is shrinking. Higher yields are essential for the anticipated increase in crop output because the most recent land use survey for the nation, published in 2021, revealed a 6% reduction in arable land from 2009 to 2019.

The largest obstacle to raising yields in China may be the scarcity of abundant, high-quality topsoil, which can take generations to restore if lost.

According to a recent assessment by a Chinese scientist, the amount of organic matter in China’s fertile northeastern soils has decreased by up to 75% during the past few decades. Bad practices have accelerated erosion and soil acidity, such as the over use of synthetic fertilizers.

The first nationwide soil quality assessment in more than 40 years was began in Beijing a year ago, and data collection will continue through 2025. However, government researchers reported last month that over the previous ten years, both the area and the severity of soil erosion had dramatically decreased.

In the past ten years, corn yields in China have climbed by more than 10%, and in recent years, their growth has actually overtaken that of the United States. This may be caused in part by using excessive amounts of fertilizer and chemicals, which compromise soil health in exchange for a tiny increase in yields.

Also, up to 70% of maize acres in China’s primary grain belt may have been illegally seeded with GM seed, according to state media reports from 2021.
When it comes to expenditure on food security, Beijing is not stingy, allocating sizable sums to initiatives like farmland preservation, land consolidation, and production subsidies.

Nonetheless, the high prices of grains and oilseeds around the world for more than two years have increased China’s need to spend more extensively in its own crop production. If costs drop, it’s unclear if these initiatives will remain top priorities.

In the past, when prices were lower, Chinese consumers found it more cost-effective to import foreign grain rather than ship domestic supplies from production areas to livestock areas further south.

Trends in Chinese Acreage

After India, China has the second-largest combined grain and oilseed acreage in the world, harvesting 33% more than the United States, which comes in third. China’s area has generally been stable during the past ten years, however it is currently 11% higher than it was forty years ago.

In contrast, the grain and oilseed sector in the United States has marginally reduced during the past ten years and has decreased by around 13% over the past forty years.

Corn made up 35% of China’s harvested grain and oilseed area in 2022, with rice coming in second with 24%, wheat coming in at 19%, and soybeans coming in at 8%. In 2007, as the price of the yellow grain soared globally, corn replaced rice as the most widely grown crop in China. In the years that followed, additional price increases spurred an increase in corn production.

China’s maize acreage has grown by about 60% since 2007, compared to growth of 5% and 4% for rice and wheat, respectively. The limitations in yield are partially explained by the fact that some of this corn development took place on marginal land. Reuters employs Karen Braun as a market analyst. Her own opinions are represented above.

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