“A great book which should wake up humankind!” –Klaus Schwab, World Economic Forum
Chapter 1. Pushing Beyond the Earth’s Limits: Growth: The Japan Syndrome
When studying the USDA world grain database more than a decade ago, I noted that if countries are already densely populated when they begin to industrialize rapidly, three things happen in quick succession to make them heavily dependent on grain imports: grain consumption climbs as incomes rise, grainland area shrinks, and grain production falls. The rapid industrialization that drives up demand simultaneously shrinks the cropland area. The inevitable result is that grain imports soar. Within a few decades, countries can go from being essentially self-sufficient to importing 70 percent or more of their grain. I call this the “Japan syndrome” because I first recognized this sequence of events in Japan, a country that today imports 70 percent of its grain. 27
In a fast-industrializing country, grain consumption rises rapidly. Initially, rising incomes permit more direct consumption of grain, but before long the growth shifts to the greater indirect consumption of grain in the form of grain-intensive livestock products, such as pork, poultry, and eggs.
Once rapid industrialization is under way, it is usually only a matter of years before the grainland area begins to shrink. Among the trends leading to this are the abandonment of marginal cropland, the loss of rural labor needed for multiple cropping, and a shift of grainland to the production of fruits, vegetables, and other high-value crops.
First, as a country industrializes and modernizes, cropland is used for industrial and residential developments. As automobile ownership spreads, the construction of roads, highways, and parking lots also takes valuable land away from agriculture. In situations where farmers find themselves with fragments of land that are too small to be economically cultivated, they often simply abandon their plots, seeking employment elsewhere.
Second, as rapid industrialization pulls labor out of the countryside, it often leads to less double cropping, a practice that depends on quickly harvesting one grain crop once it is ripe and immediately preparing the seedbed for the next crop. With the loss of workers as young people migrate to cities, the capacity to do this diminishes.
Third, as incomes rise, diets diversify, generating demand for more fruits and vegetables. This in turn leads farmers to shift land from grain to these more profitable, high-value crops.
Japan was essentially self-sufficient in grain when its grain harvested area peaked in 1955. Since then the grainland area has shrunk by more than half. The multiple-cropping index has dropped from nearly 1.4 crops per hectare per year in 1960 to scarcely 1 today. Some six years after Japan’s grain area began to shrink, the shrinkage overrode the rise in land productivity and overall production began to decline. With grain consumption climbing and production falling, grain imports soared. (See Figure 1–3.) By 1983 imports accounted for 70 percent of Japan’s grain consumption, a level they remain at today. 28
A similar analysis for South Korea and Taiwan shows a pattern that is almost identical with that of Japan. In both cases, the decline in grain area was followed roughly a decade later by a decline in production. Perhaps this should not be surprising, since the forces at work in the two countries are exactly the same as in Japan. And, like Japan, both South Korea and Taiwan now import some 70 percent of their total grain supply. 29
Based on the sequence of events in these three countries that affected grain production, consumption, and imports—the Japan syndrome—it was easy to anticipate the precipitous decline in China’s grain production that began in 1998 (as described in the next section). The obvious question now is which other countries will enter a period of declining grain production because of the same combination of forces? Among those that come to mind are India, Indonesia, Bangladesh, Pakistan, Egypt, and Mexico. 30
Of particular concern is India, home to nearly 1.1 billion people. In recent years, its economic growth has accelerated, averaging 6–7 percent a year. This growth, only slightly slower than that of China, is also beginning to consume cropland. So, too, are the needs of the 18 million people added each year to India’s population. In addition to the grainland shrinkage associated with the Japan syndrome, the extensive overpumping of aquifers in India—which will one day deprive farmers of irrigation water—will also reduce grain production. 31
Exactly when rapid industrialization in a country that is densely populated will translate into a decline in grain production is difficult to anticipate. Once production turns downward, countries often try to reverse the trend. But the difficulty of achieving this can be seen in Japan, where a rice support price that is four times the world market price has failed to expand production. 32
27. Grain database at USDA, op. cit. note 5.
28. Figure 1–3 compiled from USDA, op. cit. note 5; Japan multiple cropping index from Ministry of Agriculture, Forestry, and Fisheries, Statistical Yearbook of Agriculture, Forestry, and Fisheries (Tokyo: various years).
29. USDA, op. cit. note 5.
31. United Nations, op. cit. note 1; IMF, op. cit. note 2; Postel, op. cit. note 21.
32. USDA, Foreign Agricultural Service, Japan Grain and Feed Annual Report 2003 (Tokyo: March 2003).
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