A Barge Containing Soybeans Heading Towards the Port of New Orleans from Cincinnati by USDA
Strengthening Food Security and Stability in the Indo-Pacific
The summer of 2024 brought both severe droughts and flooding to China. Some of the worst drought conditions in recent memory left fields barren across the nation. Crops that managed to survive the drought then faced severe flooding, often killing what remained. As the global climate continues to change over the next few decades, events such as these will no longer be outliers. With increasing uncertainty in Chinese agriculture, the United States should step in to help stabilize the sector and strengthen cooperation between the two countries.
China has faced water crises for its entire history; the founding myth of China’s first dynasty involves a decades-long flood. Given rising consumer demand and declining water resources and arable land in its agricultural heartland, China already is one of the top food importers in the world, an unenviable position in times of global food strife. The United States is China’s second largest source of food imports, constituting nearly twenty percent of all of its imported agricultural products. According to the U.S. Foreign Agricultural Service, U.S. agriculture exports to China reached a record $36 billion in fiscal year 2022, making China the largest foreign market for U.S. agriculture.
With the world facing shortages from the Russia-Ukraine War and tensions rising between China and the United States, China is actively working to bolster its domestic agriculture sector and avoid dependence on U.S. imports. For the first time in its history, the Chinese Communist Party (CCP) issued a historic five-year plan on water security during its 20th National Congress in 2022 to alleviate China’s water woes. The plan seeks to combat the issue at the heart of China’s food security crisis: Northern China has almost two-thirds of the arable land in the country, yet it has less than one-fifth of the water resources. The CCP also developed the National Food Security Law, which mandates that local governments must ensure that as much of China’s food supply as possible is produced and processed domestically, took effect on June 1st, 2024.
Beijing is unlikely to cross any major U.S. red lines as long as it remains dependent on American food, but if these efforts bear fruit, the United States may lose a vital element of its strategic position in the Indo-Pacific. The current bilateral trade relationship ensures that the U.S. and China both benefit enormously from the status quo. If this economic relationship becomes less interdependent, then China will have much more strategic freedom to act aggressively in East and Southeast Asia. The status quo of intertwined economies means that neither country can upset the applecart without enormous cost to both.
Conflict between the United States and China over Taiwan could see American food exports drop dramatically, damaging both countries in the process. American farmers would lose a vital market for their products, especially soybean farmers in the upper Midwest. According to the Foreign Agricultural Service, currently nearly half of American soybean trade is with China. China faces a much worse problem, as it could lose up to twenty percent of its food imports, dangerously reducing its food supply and almost certainly causing enormous inflation.
Agriculture is a microcosm of the interdependence between China and the United States. Calls to “decouple” the two economies are increasing, but this strategy is both politically and economically short-sighted. The current interconnectedness of the two economies stabilizes the nations’ geopolitical relationship, provides avenues for collaboration, and is enormously profitable. With U.S. food exports falling across the board in 2023, this trend is already jeopardizing the power of American agriculture. If policymakers want to penalize China, they should look towards combating Chinese IP theft and agribusiness acquisitions, which actually pose a risk to the security of the United States and its firms.
Agricultural products are a key commodity export of the United States, and a strategic asset as food demand is consistent and the global food supply is not. Bolstering food production and exports and negotiating trade deals for U.S. agriculture should be a geopolitical priority for American policymakers as it can forge closer cooperation with the United States abroad and curtail foreign aggression. The U.S.-China relationship is a complicated one, but interdependence in several sectors of the economy is not a bad thing if it heightens stability in the Indo-Pacific.
