How much grain does China really have in reserve?

(Xinhua)
Updated: 2009-04-14 16:05

BEIJING -- Chinese history is rich with grain adages such as, "To the king, the people are heaven; to the people, food is heaven." That importance has carried through to modern China as Chairman Mao Zedong once said, "with grain in our hands, there is no panic in our hearts." No one has a better understanding of these words than Hou Zhanying.

He has worked for nearly 20 years at the Bureau of Grain in Xinmi County, central Henan Province. Henan produces a quarter of China's wheat and is known as country's breadbasket. "China relies on itself to feed more than 1.3 billion people. Food supply and security is important under any circumstance," Hou told Xinhua.

With less than seven percent of the world's arable land and more than one fifth of the global population, Hou says Chinese officials need to be extremely careful with the country's food supply and safety.

NATIONWIDE CHECK ON GRAIN RESERVES

It's why he's agreed to take part in a three-month, nationwide government audit of China's grain stocks. On April 1, more than 100,000 auditors began checking granaries and inventory books.

It's the second time since 2001 Hou has participated in this type of food supply check. "This time, we were asked to check more thoroughly. We are checking all grain reserves except those stored in personal homes, " he said.

As of April 10, county-level grain companies had completed self-inventories. That's the first step of the nationwide audit. Next, city governments will verify county data, which will then be rechecked by provincial authorities.

Nationwide, granaries will then be subjected to random, surprise audits. "My top priority is to make sure that there is no cheating or fabrication of figures. During the city-level check, I will be assigned to places out of Xinmi," Hou said.

The State Administration of Grain said the audit will mainly target reserves kept by state-owned companies, however, selective checks on grain stocks owned by private companies will also be conducted.

The purpose of the accounting is to "find out the true volume of our grain stocks" for national policy-making, Chinese Vice Premier Li Keqiang said at preparatory meeting on March 25.

ALARM ON FALSE FIGURE OF RESERVES

Last April, Premier Wen Jiabao said China had grain reserves of 150 to 200 million tons. That's equal to about 30 to 40 percent of China's annual grain consumption or double the 17-18 percent level regarded by the UN Food and Agriculture Organization (UNFAO) as a safe minimum for global stocks.

One year later, there continues to be questions over whether those figures are accurate as some Chinese leaders and experts believe false volumes were reported by local grain authorities and companies.

According to governmental policies, granaries receive around 75 yuan (11 US dollars) per ton of stored grain. Therefore, the more they store, the more money they are eligible for.

This has led to the exaggeration of grain volumes. Yuan Longping, a well-respected agricultural scientist, dubbed the "father of hybrid rice", told the Guangzhou Daily last week that he believed there were some granaries "reporting phony figures of stocks to get subsidies". "Since it is an open audit, they (granaries) might have been prepared and borrowed grain from others.

As a result, inspectors will be cheated." Yuan suggests secret investigations and more spot checks. He said that's what helped "catch two big fish" last year -- one in Northeast Heilongjiang Province and the other in Anhui.

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