By John E. Carey
Peace and Freedom
China announced Thursday huge tariffs on fertilizer exports and said agricultural land was in rapid decline due to industrialization.
China’s official communist news agency Xinhua News announced that export tariffs on fertilizer would increase by 100%. This will cause a virtual shutdown in the export of fertilizer from China. This is necessary to preserve fertilizer for suffering Chinese agriculture.
The fertilizer is widely used in rice, corn and wheat growing which is essential to feed the 1.3 billion Chinese. China also hopes to control rapidly rising domestic agricultural costs and inflation.
“Agricultural costs [in China] are going through the roof. Land prices, the cost of money, the relative cost of labor, fertilizer, a shortage of seeds,” said Paul Schulte, of Lehman Brothers in Hong Kong. “Yet rising agricultural prices can be a windfall for those with economies of scale.”
The China News agency also said the amount of farmland has decreased to crisis levels.
Western observers said the two announcements on the same day are an effort to prepare the world for a food shortage crisis in China.
File photo shows a Chinese farmer working in his field next to a chemical factory near Yixing Town in Jiangsu province. The amount of farmland in China has shrunk to critical levels, state press reported on Thursday(AFP/File/Mark Ralston)
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