Meat, Dairy, and the Chinese Nutrition Divide

This post was originally published on The China Nutrition Project (CNP). Asia Healthcare Blog has CNP’s permission to reprint its articles and Tayler Cox, the post author, has contributed to AHCB in the past. The original is available here.

There’s a fundamental imbalance in China’s nutritional landscape. On the one hand, malnutrition plagues rural China and the migrant populations in major cities.  Anemia alone affects 25% of rural kids on average,  and 35% of the 270,000 deaths for children under 5 in China are associated with malnutrition.  On the other side, obesity is skyrocketing in China’s cities, especially among young people.

There are many factors driving these trends. The relative poverty in some areas of rural China and decline in state-sponsored services over the past decades contribute to malnutrition issues. The introduction of cheap, processed food and sweetened beverages combined with sedentary lifestyles fuels obesity in the cities.

Fundamentally, however, the disparity in access to highly nutritious foods underlies the rural/urban divide.  Children suffering from anemia often live in poor, rural regions where many people live as de facto vegetarians with little dietary variety. Rice, corn, wheat, cabbage, and soy are common but insufficient to meet nutritional demands, whereas urban dwellers have access to fortified foods and an abundance of easily available animal products.   In 2008, urban residents ate almost twice the amount of animal products as did rural residents, and they also have access to a wide variety of fresh fruits and vegetables (1).

Noodles: not enough to meet nutritional needs

As an intern for the Rural Education Action Project (REAP) several summers ago, I was responsible for creating educational materials on anemia prevention for rural schools.  As you can tell, meat featured prominently, although we did include non-meat sources of iron on another poster.

Anemia Education Poster, Got Meat?

Even as a vegan/vegetarian, when coming up with recommendations I had to admit the value certain animal products could have for children’s diets in rural China.  Meat contains high levels of bio-available B12 and iron, which are nutrients essential for preventing anemia.  I have access to Whole Foods at home in California and thousands of supermarkets in Beijing, but where do you get your iron when all you can access are basic staples like rice and cabbage?

The Chinese government has generally supported the notion of a link between animal products and health.  After hearing reports of widespread anemia, the governor of Shaanxi province promised to provide one egg a day per child to combat malnutrition. On the national level, the sentiment has perhaps been best embodied by Premier Wen Jiaobao, who famously stated in 2006, “I have a dream and my dream is that each Chinese person, and especially the children, can afford to buy one jin [500 g] of milk to drink every day.”  The government also maintains a national strategic pork reserve so it can moderate price fluctuations and keep meat affordable even during shortages.  In recent years they’ve also promised billions of RMB in subsidies for pork and poultry production (2).

However, support for increased animal products by the government and demand for meat and dairy from Chinese consumers may not have the positive effects on rural nutritional status and health that are hoped for:

Food Prices:
This year has seen worldwide food costs at all time highs, according to the United Nations Food and Agriculture Organization (FAO).  While a complicated set of factors related to agricultural output and weather contribute, rising livestock production has put upward pressure on grain prices due to an increased need for feedstock. Pigs, for example, require 13 kilograms of feed for every one kilogram of pork produced (1).

Chinese corn consumption has been in the spotlight this year because China is relying more heavily on imports, especially from the U.S. This in turn affects U.S. food prices. According to the President of the Earth Watch Institute, Lester Brown:

 “We can anticipate substantial, further rapid growth in China’s grain consumption, most of it to expand beef, dairy and poultry production.” Turning to the [international] market for grain is in the eye of most analysts inevitable for China.

What we’re looking at is the prospect of competing with 1.4 billion Chinese with fast-rising incomes for our grain harvest, driving up our grain prices and our food prices.”

For China’s small family farmers who produce grain, increasing prices could improve farm household income.  The Chinese government is also raising subsidies to farmers growing grain by 40% this year.

Then again, due to structural changes in the commodity crops industry in China, small producers are losing out to large agribusiness and cheap imports from the U.S. and South America.  China now imports 73% of all its soy. All of the imported soy is currently used either for feedstock or for cooking oil.  Intense price competition and falling incomes have driven 30% of small soy farmers to leave the industry to become migrant workers in urban areas.  Given the similar structure of China’s corn and soy industries, and growing reliance on U.S. corn exports, a similar fate may await small Chinese corn famers.  For a more thorough analysis of how increasing demand for soy and corn impacts small farmers, check out the report “Feeding China’s Pigs” by Mindi Schneider.

More expensive food staples may have a negative impact on nutritional status in other ways as well. For rural schools with limited budgets, rising grain prices may affect their ability to provide meals to students.  For poor, non-agricultural laborers amongst the 240 million migrants in China’s cities, food price inflation also spells trouble.

Rural Farming Incomes:
For the meat and dairy industry, the economic windfall from increased demand does not necessarily benefit rural households.  The FAO reports that historically the growth in Chinese dairy sector has raised the income of small farming households, but that incomes are now falling due to structural changes in the industry and the rising costs of feedstock:

According to the Ministry of Agriculture, since early 2007, dairy cow farmers’ incomes have decreased gradually: 40 percent of households are not breaking even, and the average earnings from each cow are now 1500 yuan lower than in 2006. Some dairy cow farmers have resorted to selling or slaughtering their cows due to the low profitability. 

The reduction in incomes is due to higher production costs and relatively stable milk prices paid by the processors. Price collusion among processors is resulting from an oligopolistic market structure, with the purchasing price of raw milk controlled by only a few dairy-processing enterprises (About 10 firms representing less than 2% of suppliers account for over half the total dairy sales in China). The dispersed farm households have no bargaining power and are unable to negotiate higher prices; thus, they are obliged to receive the price offered by dairy-processing enterprises. 

While the milk price paid remains fairly constant, the price of feed is rising: Over a one-year period, feed corn prices increased by 16 percent and dry alfalfa hay prices increased by more than 20 percent. In comparison, the purchasing price of milk in Heilongjiang , Inner Mongolia and Shanxi increased only by 7 percent, 6 percent and 3 percent, respectively – despite rising prices of milk products in international markets.

A similar process is occurring for other livestock industries, as larger factory farms accelerate consolidation and compete with small, family-owned enterprises. By 2007, concentrated animal feeding operations (CAFO’s) represented 22% of China’s pig production, and for many small farmers it regulatory changes and a lack of economies of scale make it difficult to compete (1).

Environment
Environmental degradation caused by livestock production also impacts rural China.

Water
Higher demand for grain and unsustainable livestock production have strained China’s scare water resources. The Earth Policy Institute estimates that 130 million Chinese eat grain produced with over pumped well water that will soon run dry.

Roughly 320 million in rural China do not have access to safe drinking water, and for 91 million the problem is water source pollution.  One of the greatest contributors to water pollution is agricultural run-off, especially from livestock farms. According to a 2007 national census, the livestock industry dumped 243 million tons of untreated feces and 163 million tons of urine into waterways,  and contributed 98%, 38% and 56% of total chemical oxygen demand (COD), nitrogen and phosphorus in the run-off. While the government has pledged billions of RMB for a clean-up effort, increasing livestock production will only exacerbate the problem.

Deserts
Excessive overgrazing is estimated to contribute to about 30% of desertification in Northern China. As the dessert expands ever southward, thousands of small villages have been forced to relocate.

With demand rising for animal products, overgrazing will continue to be a problem. According to the Lester Brown, President of the Earth Policy Institute, the situation is grim:

While overplowing is now being partly remedied by paying farmers to plant their grain land in trees, overgrazing continues largely unabated. China’s cattle, sheep and goat population tripled from 1950 to 2002. The United States, a country with comparable grazing capacity, has 97 million cattle. China has 106 million. But whereas the United States has 8 million sheep and goats, China has 298 million. Concentrated in the western and northern provinces, sheep and goats are destroying the land’s protective vegetation. The wind then does the rest, removing the soil and converting productive rangeland into desert. Northwestern China is on the verge of a massive ecological meltdown.

Are meat and dairy the answer for rural nutrition?
Expanding the meat and dairy supply may improve malnutrition in rural China, but it’s not a clear net positive when considering the social and environmental consequences of the expanding Chinese livestock industry. This is especially true for rural residents who work on small farms, and whose livelihoods are threatened by the rise of large agribusiness in commodity crops and animal products.

Mindi Schneider, a recent Fulbright Scholar to China studying the pig feed industry, summed up the magnitude of the problem in her report for the Institute for Agriculture and Trade Policy:

Using the $1.25 USD per day poverty guideline, there were 150 million poor in China at the end of 2009. According to Li Xiaoyun, Dean of the Center for Integrated Agricultural Development at the China Agricultural University, an additional 20 to 30 percent of the rural population (140 to 230 million people) are precariously close to slipping back below the poverty line because of sick­ness, natural disaster or economic recession. This vulner­able population is predominantly smallholder farmers […] who may still dream of having more meat to eat.”

While a project by the Chinese Center for Disease Control and Prevention (CCDCP) in rural Guangxi demonstrated that providing meat and more vegetables in kids’ diet is an effective solution for malnutrition, REAP has also demonstrated that even just a vitamin costing just 1/10^th of an RMB per day can improve the anemia status of primary school students.  Clearly rural areas need more nutritional support, and both meat and non-meat supplements are options.  However, adopting the blunt policy of “more meat and dairy for everyone” may not be the hoped-for panacea to rural nutritional problems.