China’s plan to build corn mill in US draws scrutiny

2022.10.03

Combining a shrinking 7% to 9% of the world’s arable land with a growing 20% of the global population means China must add another element to the equation if it wants to feed its people.

Trade with other nations helps with the deficit but also opens China to risks such as conflicts with trading partners or supply chain breakdowns. Reaching outside of its borders through foreign investment, including investing in farmland, animal husbandry, agricultural equipment and intellectual property across the globe, is that new element China is bringing to its equation, and the reaction in other nations has been a variable.

The nation has made significant agriculture-related acquisitions in Africa, Asia, Australia, South America and the United States, amounting to more than 1,300 agricultural, forestry and fisheries enterprises with registered overseas investments of $26 billion by the end of 2016. Signs point to more investment as Chinese leaders encourage it as a core component of the One Belt, One Road initiative that seeks to build connectivity across six main economic corridors.

Some purchases have made the home nations uncomfortable, raising concerns about national security as well as questions about China’s motives. In the United States, a 2021 purchase of North Dakota farmland by Fufeng Group of Shandong, China, for a new wet corn mill has met with resistance from local and national political leaders. They say the project is a major security concern given its proximity to a US Air Force base. As a result, some US lawmakers are calling for policies that range from increased scrutiny of agriculture deals to outright bans of purchases by some countries.

“There is no goodwill tied up in their presence in the US,” said Rick Crawford, US representative for Arkansas and member of the US House Agriculture and House Intelligence committees. “They are here for the advancement of their own interests and not for ours. Everything that China does, in the US in particular, but anywhere else, is done with an eye toward gaining a strategic advantage for themselves. A lot of times they cloak this in the idea that they’re doing this to improve economic conditions in a given country.”

In terms of total foreign ownership in the United States, China accounts for slightly less than 1%, and it has spent about 2% of its overseas agricultural investments in North America, according to the US Department of Agriculture (USDA).

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