World Grain - November 2013 - 6

from the editor-in-chief

huge government
impact on industry

overnmental actions affect consumer
demand for grain-based foods in both
direct and indirect ways, sometimes
powerfully and other times without moving
the consumption needle. How such actions
vary from country to country presents one
of the dilemmas facing grain-based foods,
no matter where. That is especially the case
when the industry might envision a positive
role the government could perform while the
bureaucracy, no matter how well intentioned,
differs considerably from what makes sense
to people involved in building demand.
In the United States, government has direct and even considerable influence on actual consumption of specific products through
two programs. One is the National School
Lunch Program where schools are told what
items may be offered to eligible children and
what are prohibited. The other is the food
stamp or Supplemental Nutrition Assistance
Program (SNAP) where billions are expended to bolster food purchases by millions of
low-income consumers. Beyond these federal programs directly impacting how much
and what consumers buy is the influence
Washington seeks to exert over eating patterns. Specific recommendations are made as
to how much bread should be eaten each day
and week, including just how much should
be whole wheat, as well as urging reduced
eating of foods high in calories and fat.
Making comparisons with what other
countries may be doing along the same lines,

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either purposely to influence foods that are
eaten or indirectly impacting consumption
levels, shows that the American efforts are
unusually specific. At the other end of the
spectrum is China where eating patterns
have been powerfully affected by soaring
personal incomes during the past several decades. As might be expected, higher incomes
have meant a sharp decline in per capita consumption of grain-based foods, specifically
of wheat and rice. The fall has mainly occurred in rural areas, while urban per capita
use has stabilized. The latter occurred as new
wheat-based foods captured a major role in
China's fast-growing food service sector.
The role of China's government in influencing food consumption has mainly been
through its stimulus to incomes. Whenever
China embarks on a new effort to boost
the growth of its manufacturing sector,
the impact on food consumption has been
as dramatic as it has affected all the other
elements of the economy. China's food focus has been less on grain-based foods, except to assure adequate crops, and more on
poultry, meat and fish, which have been the
primary beneficiaries of rising consumer
incomes. Efforts to assure safe food have
received greater attention than worrying
about nutrition.
While personal income levels have been
the primary force making for rapid changes
in Chinese eating preferences, urbanization
has gained a powerful position. Prior to the

1970s, hardly 20% of China's population
lived in cities and 80% were rural. With
mechanization of agriculture, that ruralurban divide began changing to the point
currently that the two populations are equal.
The government has declared its intent to
speed up depopulation of the countryside in
the hope of having only 20% living in rural
areas by mid-21st century.
Modernization and industrialization are
words joined with urbanization in the current Chinese undertaking. But these are not
the fundamental goal. The latter is building
domestic demand by moving people from
rural areas, where they are largely self-reliant in meeting daily needs, to towns and
cities where needs are purchased and thus
stimulate economic activity. It requires little
imagination to understand how urbanization affects food demand as much or more
than higher incomes. Yes, urbanization accounts in part for the downtrend in per capita
consumption of wheat in total, but it also
stimulates demand for baked foods made
from wheat flour in ways that make for a
hugely different grain-based foods industry
from what existed before these government
programs began. Regardless of these huge
differences, the governments in the United
States and China have much to do with the
well being of grain-based foods.

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WORLD GRAIN (ISSN 0745-8991) Volume 31, issue 11,

Morton I. Sosland
Editor-in-chief

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World Grain - November 2013

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