Pork, the Chinese Staple of Daily Consumption, and Wheat, the Northern Staple Food.Trump’s True Hidden Trump Card Against China.
Based on the lead column by Kaji Nobuyuki in the monthly magazine WiLL, this essay analyzes the essence of the U.S.-China trade conflict through China’s food supply structure, especially pork and wheat.
By highlighting the fact that China is not a true agricultural superpower and depends heavily on imported grain, it sharply identifies the real pressure card President Trump was holding against China.
2019-03-27
Chinese people love pork and eat it almost every day.
What happens if both pork and wheat, the staple food of northern China, do not sufficiently reach the people.
When human beings do not have enough food, they invariably resort to force.
Everyone who has read this month’s issue of the monthly magazine WiLL must surely have groaned in admiration, saying, this is the genuine article.
What follows is from the opening serialized column by Kaji Nobuyuki.
The emphases in the text are mine.
I, an old man, have no English ability.
Therefore, if I want to know something about America, for example, I have no choice but to rely on information from the Japanese media.
For that reason, I have often been deceived by information from the Japanese media.
But that is the fault of my own shallowness.
In short, it means one should keep in mind that one does not really understand the affairs of other countries.
However, even without English ability and even without American information, one can still see President Trump’s strategy toward China, and what card he has hidden in his breast pocket.
Why.
Because I possess a certain amount of knowledge about China.
So let me speak about that card.
As for economics itself, and more concretely trade itself, I naturally understand nothing.
Yet when I hear what Trump is saying loudly, I immediately understand the essence.
First of all, the trade imbalance.
In relation to China, China runs a surplus and America a deficit.
The strategy is to exploit that trade imbalance in reverse and threaten the collapse of the Chinese regime.
As a tactic for that purpose, he first notified China that he would impose higher tariffs on imports in order to reduce his own country’s trade deficit.
However, the policy was to change it in three stages.
Looking back a hundred and fifty years, the Meiji government suffered from trade imbalances.
Ordinarily, in order to correct one’s own trade deficit, one imposes tariffs on cheap imports from abroad, raises their prices to the level of domestic products, and protects one’s national economy.
However, under the treaties concluded with the Western powers at the end of the shogunate, Japan had no right to impose tariffs autonomously.
Thus it struggled to revise the treaties in order to obtain that right.
Later, it succeeded in revising them.
But in the modern age, if the price of imported goods is unfairly low, it has become a standard means to impose tariffs and protect domestically produced goods.
Now, returning to the subject, when America activated punitive tariffs against China over the U.S.-China trade imbalance problem, China retaliated by imposing a 25% tariff on soybeans imported from America.
When written like this, many people are surprised.
Does China import soybeans, they ask.
That is because they mistakenly believe China to be an agricultural country.
If the world’s cultivable land is taken as 100%, China has only 7%.
It has no choice but to import agricultural products.
In China, soybeans are used to extract edible oil, and the soybean meal is used as feed for pigs.
This means China itself raised the price of this pig feed imported from America by 25%.
Naturally, the domestic price of pork rises.
Of course, 53% of imported soybeans come from Brazil and 34% from America, so for the time being China can get by with Brazilian soybeans, but beyond that nothing is certain.
China’s tactic was presumably that, by means of these tariffs, American farmers, who form Trump’s support base, would suffer a decline in income and support for Trump would waver, yet astonishingly China is now obediently complying with Trump’s various demands.
Why is this.
The answer is clear.
It is because China is terrified, utterly terrified, of the next card Trump might play as a countermeasure.
Though the data are more than ten years old, China has been importing vast quantities of wheat, which is a staple food.
That is because it is not an agricultural country.
The volume of wheat imports from the three countries of America, Canada, and Australia is 30 million tons.
Since the annual consumption of 100 million people is 10 million tons, China has continuously been importing enough wheat for 300 million people.
For northern China, where wheat is the staple food, difficulty in importing wheat becomes a matter of life and death.
Chinese people love pork and eat it almost every day.
What happens if both pork and wheat, the staple food of northern China, do not sufficiently reach the people.
When human beings do not have enough food, they invariably resort to force.
If that is so, then the card hidden in Trump’s breast pocket, namely a reduction in the volume of wheat exports to China, is something China fears beyond measure.
Therefore, I believe the Chinese government hopes to end the trade issue around the soybean problem.
The ancients said, govern disorder before disorder has yet arisen, and secure the river before danger has yet arrived.
