GM Soybeans And China’s Food Security Dilemma

Executive Summary

• The Ministry of Agriculture and Rural Affairs (MARA) recently approved 37 genetically modified (GM) corn varieties and 14 GM soybean varieties after a three-year trial, marking the first such announcement by the PRC government.
• The PRC’s focus on improving food security is evident in legislative and policy measures, including the Food Security Law set to take effect on June 1, 2024, emphasizing domestic production and self-sufficiency.
• Public opposition to GM crops, fueled by concerns over biosafety and distrust of the government, has slowed commercialization efforts, despite reassurances about safety, quality, and endorsements from prominent scientists. The PRC government faces challenges in shifting public sentiment in the short term.
• China’s ongoing food security challenges include being a net importer, concerns about overreliance on international markets, and issues like water scarcity, soil pollution, and competing land uses.

Last month, the Ministry of Agriculture and Rural Affairs (MARA) of the People’s Republic of China (PRC) approved 37 genetically modified (GM) corn varieties and 14 GM soybean varieties after a three-year trial. [1] These varieties have been bred for stronger herbicide or insect resistance and produce higher yields compared to conventional ones (MARA, December 7, 2023). The announcement was the first of its kind by the PRC government, and follows a decision from a national committee established by the agriculture ministry in October (MARA, October 27, 2023; see also MARA, November 28).

The PRC’s move to introduce the cultivation and commercialization of GM seeds is part of a broader effort to increase domestic food production, achieve self-sufficiency, and thereby reduce reliance on global markets. These aims are the result of national security concerns as the country seeks to insulate itself from a volatile international environment, but also of domestic issues. Feeding a growing and increasingly prosperous population from a dwindling and depleted arable landmass necessitates agricultural reform across several domains. But obstacles to this reform have proven difficult to overcome.

China’s Soybean Reliance And Vulnerabilities

Soybeans are crucial to China’s food security and are commonly used in animal food, human food, and industrial products. Although the PRC is a major soybean grower with current output estimated at nearly 21 million metric tons (mmt), the country is also the world’s largest soybean importer (State Council, January 19, 2023). In 2023, Chinese soybean purchases reached nearly 85.4 mmt—an 11.4 percent increase from 2022 (Sina Finance, January 16). These imports came mainly from the United States, Brazil, and Argentina.

China’s import reliance is a reversal from the early days of the PRC. From 1949 up to the mid-1990s, the PRC was the world’s largest producer and a net exporter of soybeans. However, World Trade Organization accession negotiations forced Beijing to lower its overall agricultural tariffs and subsidies to the domestic agricultural industry. [2] Without the protections afforded to an insulated economy, the domestic industry shrank rapidly. Between 2008 and 2013, the area dedicated to soybean production decreased 24 percent. Meanwhile, imports skyrocketed from around 1 mmt in 1996 to more than 110 mmt in 2021 (China Daily, April 14, 2016; Reuters, January 14, 2022).

Imported soybeans are genetically modified and are mainly processed to produce meal for animal feed and cooking oil. (Soybean oil is the primary edible oil in China, accounting for about 42 percent of the total edible oil consumption in the country. [3] Locally produced soybeans are non-GM and primarily used for direct human consumption (e.g., as tofu, soymilk, and soy sauce). Consumption of edible oils and soybean meal has outpaced the growth of the consumption of soybean food products. [4] Further increases are expected as rising incomes and urbanization shift consumption habits and dietary preferences, such as increased consumption of livestock (which feed on soybeans), soybean-based foods, and nutritional supplements (US Department of Agriculture, March, 2019).

China’s food security has deteriorated significantly in recent decades. In 2004, China moved from being a net exporter of food to a net importer. The widening import-export gap has raised concerns about an overreliance on international markets for food supplies, as this could make China vulnerable to export bans and global food price fluctuations. Moreover, skyrocketing food consumption coupled with the loss of viable farmland have made these issues more acute. China has limited water resources and arable land, significant soil pollution, and competing land uses (Xinhuanet, November 20, 2016; see also National Soil Pollution Survey, April 17, 2014).

Geopolitical tensions have informed the PRC’s views on food security. Reliance on foreign soybeans was a weakness that was exploited during the Trump-era trade war. It remains a weakness, as soybeans constituted nearly half of record-high agricultural exports from the United States in 2023 (US Department of Agriculture, January 6, 2023). Global food security is increasingly dependent on the movement of food from a few major breadbasket regions to food-deficit areas across the world, often through “food chokepoints.” Beijing worries that food supply (both in terms of availability and prices) could be affected by potential maritime embargoes in the instance of conflict in the South China Sea or over Taiwan.

Policy And Legislative Solutions

Improving food security has been a consistent priority for Xi Jinping (NPC, March 3, 2010; Xinhua, September 22, 2022). He famously declared that the rice bowls of China’s 1.4 billion people “will always be firmly held in their own hands (牢牢端在自己手中)” (State Council, September 22, 2022).

The PRC’s focus is evident in its legislative and policy measures. The 2015 National Security Law (国家安全法) was crucial, enshrining various aspects of food security as tasks for preserving overall national security (Xinhua, July 1, 2015). More recently, a report from the State Council to the Standing Committee of the 14th National People’s Congress (NPC) proposed eight tasks to ensure national food security, including strengthening the country’s capacity-building. Xi’s remarks at the Central Rural Work Conference reaffirmed this, stressing that both Party committees and governments must be held accountable for food security (PRC State Council, December 20, 2023; Xinhua, December, 2023). Similarly, the current Five-year Plan highlights food security, while 2023’s “No.1 policy document” (the country’s rural blueprint) emphasizes that “a strong country must first have a strong agricultural [sector] (强国必先强农),” and explicitly ties food security to Xi Jinping Thought on Socialism with Chinese Characteristics for the New Era and the concept of “Chinese-style Modernization” (MARA, February 14, 2023; State Council, March 7, 2023).

On June 1 this year, the PRC’s Food Security Law (粮食安全保障法) will come into effect (wikisource, accessed January 16). Adopted by the NPC on December 29, 2023, the law builds on these previous pieces of legislation, as well as the 2022 “Black Soil Protection Law (黑土地保护法)” and the 2021 “Anti-Food Waste Law (反食品浪费法)” (NPC, June 1, 2023; NPC, April 29, 2021).

GM crops provide a clear solution to bolstering domestic production and enabling further self-sufficiency. They could allow Beijing to meet its targeted domestic soybean output of 23 million tons by 2025 (MARA, December 29, 2021). Specific legislation has been passed here, including rules for registration requirements for herbicides used on GM crops (MARA, March 25, 2022); the 14^th Five-Year Plan on Bioeconomy (2021-2025), which emphasizes modernizing bio-agriculture (NDRC, May 10, 2022); and a certification standard for GM crops, helping to clear the path for domestic commercialization, including for soybeans (Global Times, June 8, 2022).

Some progress has been made on the ground. In 2021 MARA laid out a clear path for seed makers to seek approval for corn varieties that integrate GM traits (Reuters, November 15, 2021). In 2023 MARA announced that it would plant around 4 million mu (660,000 acres, or 1 percent of the country’s corn fields), with GM corn that year (Reuters, February 17, 2023). It also expanded a pilot program planting GM soybeans in 20 counties across five provinces (Hebei, Jilin, Sichuan, Yunnan, and Inner Mongolia Autonomous Region) (Caixin, August 25, 2023). Beijing has not yet stated that it aims to commercialize GM crops for domestic human consumption, but such a development would fit into the broader context of responses to China’s concerns over food security.

The majority of investment in GM crop development comes from the government. State-owned enterprises (SOEs) and research centers (such as the Chinese Academy of Agricultural Sciences, a national research institution directly under MARA) (see also State Council, October 4, 2021) have a broad mandate encompassing research and development (R&D). Over 7,600 seed companies make up the private sector, though it is only responsible for 10 to 20 percent of R&D (China Seed, August 10, 2023). However, China’s overall R&D capabilities are relatively weak due to low investment and weak copyright protection. (Despite ranking first in the world for seed-patent applications, the majority of China’s 1,225 patents come from a single SOE (South China Morning Post, July 1, 2023).)

SOEs such as China National Agrochemical Corporation (ChemChina) have played a significant role when it comes to acquiring foreign agribusinesses to support domestic GMO research. In 2017, ChemChina acquired Syngenta, a Swiss agribusiness and global powerhouse in GMO crop development, for $43 billion, thereby becoming one of the world’s largest agrochemical and seed companies (Xinhua, June 8, 2018). This is only one of several international merges in recent years (see for instance Reuters, July 18, 2017).

Technological solutions are being pursued in Yazhou Bay Science and Technology City. Established a few years ago to support R&D, the area includes Nanfan, the seed “Silicon Valley” and the PRC’s largest agricultural breeding base. At present, the Nanfan base houses nearly 800 seed research institutions and businesses (Global Times, April 6, 2023). In an apparent success, cultivars bred in Nanfan constitute over 70 percent of the PRC’s approved new crop varieties (People’s Daily, June 26, 2023; HQ News, March 23, 2023) such as hybrid-rice varieties (China Daily, April 20, 2020). It is unclear if any GM seed R&D is taking place in Nanfan, but seed companies that are interested in GM seed development such as Dabeinong Group (大北农集团) and Yuan Long Ping High-Tech Agriculture (隆平高科) do have offices or labs there (China Daily, June 1, 2022).

Popular Discontent And Its Management

Commercialization of major GM crops has stalled in part due to public opposition. Consumers have long been skeptical about GM food over concerns that it causes serious illnesses. These concerns have been buttressed by negative voices within the system and food safety scandals. In an influential Global Times op-ed in 2013, People’s Liberation Army Major-General Peng Guangqian (彭光谦) claimed that the West was using GM crops to threaten China’s food security, and that MARA officials and bio-scientists were being encouraged to commercialize them through bribes from multinational companies (Huanqiu, August 21, 2013). Around the same time, reports of widespread illegal plantation of foreign-developed GM crops fuelled fears about foreign control of China’s GMO market (State Council, March 6, 2014). Earlier, in 2008, baby formula contaminated with melamine (a chemical used to make plastic) killed six babies and the poisoning of three hundred thousand children in 2008 (China Brief, October 7, 2008).

Certain Party behaviors exacerbate popular concerns. Top Party leaders have their own food supply chain (特供食品), a practice which dates back to the Mao era (RFA, November 20, 2012). This raises questions over inequality in access to safe food, but also distrust of the government given that the special supply chain is made up of organic produce, rather than GM products. To this end, some argue that opposition to GMOs is not so much an issue with biosafety but rather a means of people to express their distrust of the food system and the government’s role in making and carrying out policies pertaining to biotechnology. [5] Opposition to GM products has also extended into local governments. For instance, Heilongjiang, the country’s biggest soybean growing region banned the planting of GMOs in 2016, despite conflicting with national policies (Xinhua, December 16, 2016). For this it received rebukes from state media outlets (see also MARA, November 2, 2023). [6]

The government has sought to reassure consumers of the safety and quality of domestic brands and is seeking to improve national food safety standards (e.g. MARA, December 25, 2023). Beijing uses Chinese state and social media as part of the public relations drive to dispel skepticism and has even encouraged Chinese scientists such as Yuan Longping (袁隆平)—considered “the father of hybrid rice”—to endorse GMOs publicly. [7] A Q&A on MARA’s website states that “all approved GM [foods] are safe” (MARA, August 24, 2023; see also MARA, July 6, 2023). More innovative solutions to broader food safety concerns have also been undertaken by the private sector, including high-tech solutions that improve supply chain visibility (Sohu.com, May 1, 2022). [8]

The impact of these events on public trust persists, however. In 2018, a nationwide survey found that 46.7 percent of respondents had negative views of GMOs and 14 percent viewed GMOs as a form of bioterrorism aimed at China. Other surveys have reinforced this perspective. [9, 10, 11] Given these facts and the recent history, the PRC government will struggle to shift popular sentiment in the short term.

Conclusion

The PRC has invested a considerable amount in legislative efforts, capital investment, and public information campaigns to increase the country’s ability to successfully produce and commercialize GM crops. Despite recent advances in each of these areas, it will be a number of years before China sees widespread cultivation of GM products. Beijing fears that time is not necessarily on its side, however, given internal and external pressures on food security. In the short term, the PRC will remain a net importer of soybeans and other such products, but it may continue diversifying import sources to more ‘China-friendly’ countries to ensure a stable supply.

Notes

[1] GM seeds are seeds that have been genetically altered using biotechnology techniques. Genetic modification involves the manipulation of an organism’s genetic material (DNA) to achieve desired characteristics such as higher yields and resistance to pests.

[2] Yan, H., Yiyuan, C. and Bun, K. H. (2016). China’s soybean crisis: The logic of modernization and its discontents. The Journal of Peasant Studies, 43(2), pp. 373–395.

[3] Zhongtai Securities, https://pdf.dfcfw.com/pdf/H3_AP202106181498513163_1.pdf. Published June 17, 2021.

[4] See also, Gale, F., Valdes, C. and Ash, M. (2019). Interdependence of China, United States, and Brazil in soybean trade. US Department of Agriculture’s Economic Research Service (ERS) Report, pp. 1–48.

[5] Xiao, Zhihua, and William A. Kerr. “The political economy of China’s GMO commercialization dilemma.” Food and Energy Security. 11.3 (2022): e409.

[6] Zhang, Hongzhou, and Alfred M. Wu. “Central-Local Relations in China: A Case Study of Heilongjiang’s GMO Ban.” The China Quarterly (2023). Given Heilongjiang’s financial interest in locally produced soybeans, the GMO ban could be considered as a form of protectionism to protect local farmers from competition from cheaper GM imports, rather than food safety considerations.

[7] Ibid.

[8] At the extremes, these include “blockchain chicken farms,” “Gogochicken,” and animal facial recognition, which allow consumers to monitor the age, location, and even the distance walked each day of the poultry they are buying, as well as for better health monitoring.

[9] Cui, K., Shoemaker, S.P. Public perception of genetically-modified (GM) food: A Nationwide Chinese Consumer Study. npj Sci Food 2, 10 (2018). https://doi.org/10.1038/s41538-018-0018-4

[10] Deng, Haiyan, and Ruifa Hu. “A crisis of consumers’ trust in scientists and its influence on consumer attitude toward genetically modified foods.” British Food Journal 121.10 (2019): 2454-2476.

[11] Other studies suggest that perceptions might be changing, however. One finds that 40 percent of Chinese respondents accept GM-labelled foods. (Zhao, Yawei, et al. “The Chinese public’s awareness and attitudes toward genetically modified foods with different labeling.” npj Science of Food 3.1 (2019): 17.)