{"id":50002888,"date":"2015-07-08T16:01:59","date_gmt":"2015-07-08T15:01:59","guid":{"rendered":"https:\/\/stage.dialogochino.net\/?p=2888"},"modified":"2022-12-12T17:11:40","modified_gmt":"2022-12-12T17:11:40","slug":"2888-chinas-search-for-food-in-latin-america-grabbing-headlines-not-land","status":"publish","type":"post","link":"https:\/\/dialogue.earth\/en\/business\/2888-chinas-search-for-food-in-latin-america-grabbing-headlines-not-land\/","title":{"rendered":"China\u2019s search for food in Latin America: grabbing headlines not land"},"content":{"rendered":"

Faced with rapid urbanisation, polluted or degraded arable land and a desperate need to feed its enormous population, China has resorted to \u201cgrabbing\u201d thousands of hectares of overseas soil in order to guarantee supplies of crops like sugar and soya – or so the story goes. But new research by US-based think tank the Inter-American Dialogue<\/a> (IAD) exposes some of the inaccuracies in reports of China\u2019s overseas agricultural investment, which include inflated stories of state-led land acquisitions. China\u2019s Agricultural Investment in Latin America: a critical assessment<\/a><\/em> also highlights that there are diverse motivations driving China\u2019s relatively few land purchases or leases in Latin America. Estimates suggest that around a third of farmland in China is degraded or polluted. And the government admits that 2.4%, some 3.3million hectares, is too degraded to support any agricultural activity. The Chinese government is trying to tackle widespread soil pollution<\/a> with tougher penalties on banned chemicals and industry-wide monitoring standards introduced earlier this year. But this will likely take time to yield results and food security remains an urgent priority. The report explains that China\u2019s approach to food security focuses less on foreign direct investment (FDI) and more on trade; aiming to control prices and supply chains by supporting investment in logistics<\/a> and processing rather than buying farm land. Grabbing headlines \u201cThe amount of land supposedly purchased by China in Latin America is often exaggerated,\u201d said Margaret Myers, director of the China and Latin America programme at the IAD and co-author of the report. Despite reports of dozens of \u2018land-grabs\u2019 in the Latin American media, Myers says that after \u201cextensive research\u201d they could confirm only 10 examples of successful Chinese land purchases in the region. And only few of these were for the purpose of crop production for export to China. Most reported deals have either fallen through or stalled. \u201cChinese agricultural investors have\u00a0not\u00a0been able to get around local laws preventing them from acquiring land,\u201d Myers told Di\u00e1logo Chino. Media reports often point to Chongqing Grain Group<\/a>\u2019s acquisition of 200,000 hectares of land in Bahia, Brazil, as indicative of China\u2019s territorial aspirations. But after a reinterpretation of the law in 2010, the deal stalled<\/a>. And although Chongqing Grain and the Brazilian government eventually reached an agreement, as of 2015 the site has still not been developed. The largest confirmed Chinese land deal in Latin America which has led to significant development was made by Chinese state-owned logistics technology company COMPLANT, <\/a>which bought 27,000 hectares of land from the Jamaican government for US$ 774million in 2011<\/a> to develop sugar cane farms and factories. But the deal pales in comparison to the 300,000 hectare \u2018land-grab\u2019 in Rio Negro province, Argentina, as reported by Argentine daily La Naci\u00f3n<\/a><\/em> \u2013 another deal which failed to materialise. And previous\u00a0research reflects these\u00a0discrepancies. GRAIN <\/a>(1 million hectares), the International Institute for Sustainable Development <\/a>(800,000 hectares) and Land Matrix<\/a> (500,000 hectares) have greatly differing estimates of how much land China actually owns or leases in Latin America. The IAD could confirm leases or purchases amounting to\u00a0only 70,000 hectares. No \u2018Chinese characteristics\u2019 are responsible for all land purchases in Latin America, the report says. In fact, those that drove the first purchases of land in Cuba and Mexico in the 1990s which were misunderstood as land-grabs and were actually a form of overseas development which successfully increased rice crop yields. However the benefactor, China\u2019s Suntime Group, also reported \u2018handsome profits\u2019<\/a>. And agricultural firm Zhejiang Fudi<\/a> Agriculture Group, which had a mere 3,000 hectares of land available for cultivation in its home province of Huafeng according to the report, purchased 16,000 hectares of arable land in the Brazilian state of Tocantins in 2009<\/a>. The IAD report characterises Zhejiang Fudi as self-motivated and profit-seeking, and suggests that this drives their overseas land purchases. Myers points out that Chinese companies and even China\u2019s sovereign wealth fund<\/a> have also been successful in purchasing some major foreign agricultural firms, such as multinational distributor Nidera<\/a>, which has assets across the agricultural value chain in Latin America and worldwide. This focus on controlling supply chains is more typical of China\u2019s agricultural investments \u2013 and companies like state-owned COFCO<\/a>, which acquired a $1.5 billion majority stake in global distributor H.K. Noble<\/a> in 2014, could one day challenge the big Western distributors, says Myers. COFCO president Patrick Yu, indicated in a 2011 interview that the big four Western companies ADM<\/a>, Bunge<\/a>, Cargill<\/a>, and Louis Dreyfus<\/a> (referred to as ABCD) now control almost the entire raw material base in North and South America and offer a useful example for COFCO to follow.