With China’s increasing focus on agricultural mechanization and corn farming, several major US agribusinesses are becoming more involved in bringing Chinese farmers agricultural technology, equipment, and best practice training. Companies such as DuPont, Vermeer, John Deere, Kemin, and AGCO, some of which have been in China for decades, are now increasing their activity on the ground to help address key issues facing Chinese agriculture. Increased demand for livestock feed means corn is quickly becoming one of China’s most important crops, and if meat consumption continues to grow, China may face acorn deficit in the long-term. In addition, if China’s youth population continues the trend of moving away from farming communities and into cities, replacing farm labor will be difficult without increased agricultural mechanization. A growing market in China for farm equipment is especially important to these American manufacturers, as the number of tractor units being sold is declining across North America and Europe.
Last year, Georgia-based AGCO launched a new series of tractors as part of its $100 million project to expand its operations in China, and plans to build another high-horsepower tractor factory in Daqing. Iowan company John Deere, which has been in China since the 1970s, also has multiple production facilities in China’s Heilongjiang Province, which is now largely corn country. Bayan Village, which is considered one of DuPont Pioneer’s “smart villages” in Heilongjiang, provides farmers with a number of services, including corn seed and training. Chinese demand for farming technology has offered US agribusinesses many lucrative opportunities for expansion, and China’s growing need for corn imports could raise prices and mean greater profits for farmers in places like Iowa. However, experts have also speculated that an increase in demand could also mean higher prices for US consumers.
Chinese president Xi Jinping also has ties with American corn culture, having visited Iowa for agricultural research in his youth and again in 2012 to connect with Iowan farmers, who rank number one in the US for corn production. Sustainable agriculture has become a serious policy issue for China, a country that feeds 22% of the world’s population using less than 9% of the world’s arable land, so it is imperative that Chinese farming efficiency continues to grow.
Lincoln Lin is a Research Intern at the East-West Center in Washington and a graduate student at the Johns Hopkins School of Advanced International Studies.