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China Sees Grain Production and Financing as a National Security Issue

A China Review News article suggests that the rising price of grain is looming as a national security issue for China. The world is experiencing the most dramatic commodity price hikes in three decades. Grain prices, along with oil prices, are hitting record highs. Grain markets have become part of the composite global financial system, intertwining with markets for capital, foreign exchange, futures, and other financial derivatives. Grain prices are vulnerable to the global capital flow. The recent Middle East crisis is pushing the oil and grain price spiral even higher. The article suggests that China elevate grain production and financing to a national strategic level by applying tight control over the production and sales chain, gaining power over pricing, stipulating relevant policies, setting up a grain investment and reserve bank, and developing grain related financial markets.

Source: China Review News, April 1, 2011