If the government wants post-Covid reforms to work, small farms need real regulation.
Each spring, millions of Chinese gather around their televisions for two hours of naming and shaming corporate brands, for offenses ranging from poor customer service to outright fraud. This year, the Consumer Rights Day extravaganza was mostly the same, with offenders including Ford Motor Co. Yet amid the usual multinationals were some outliers: scruffy sheep farmers located 120 miles south of Beijing. The show revealed that these farmers regularly dope their sheep with clenbuterol — a powerful, banned growth enhancer — that can cause serious health problems in humans.
This week came news that the World Health Organization is zeroing in on China’s wildlife farms as the likely source of the global Covid-19 outbreak. What the two scandals have in common is that they demonstrate just how difficult it is to oversee China’s immense system of small farms — especially when local officials have incentives to ignore obvious problems. As the government embarks on promised post-pandemic reforms, that will have to change.
In most places, farms grow in parallel with urbanization, economic growth and agricultural productivity. That hasn’t happened in rapidly urbanizing China, thanks partly to government ownership of the land. Instead, farmers control state-allocated plots that they can’t readily transfer, and seek ways to boost yields on them. It isn’t easy: The average Chinese farm is about 1.25 acres, and typically subdivided into quarter-acre plots.
Unable to boost scale via land acquisition, farmers have long resorted to chemical means, including the use (and overuse) of fertilizers and pesticides. That’s one reason that China leads the world in pesticide use by a wide margin (the U.S., with more arable land, uses a quarter of what China does). Local governments, keen to see agricultural production boom, tend to look the other way, even as distant Beijing prioritizes cleaning up the food supply.
It’s not just the crop farmers who struggle with size. A recent survey of chicken farmers in northwest China found widespread abuse of antibiotics. Clenbuterol offers another shortcut. Often called “lean meat powder,” it’s been added to animal feed for decades as a means of inducing weight gain and boosting the proportion of muscle to fat. In 1997, China instituted a ban on adding the substance to feed, but it proved largely ineffective. A 2015 study found that farmers were still earning a significant premium on pork raised with clenbuterol. Consumers suffered, but for the land-starved farmer, it was a way to grow.
The only problem was that this growth was accompanied by large outbreaks of clenbuterol-related sicknesses. In 2011, the government was fed up enough to send state media after a particularly egregious example that resulted in more than 100 prosecutions, with several offenders receiving suspended death sentences. In addition, officials announced a range of reforms designed to stop farmers and food processors from using illegal additives.
That crackdown didn’t amount to much either. In the mid-2010s, it was common knowledge (or gossip) among vendors at my local wet market in Shanghai that meat sold at other markets was still contaminated with clenbuterol. More recent surveys of retail and wholesale meat markets have found significant traces of it. According to the farmers and brokers featured on the Consumer Rights Day show, the drug still adds $7 to $9 to the value of a sheep. Getting that meat into the marketplace is really just a matter of selling it by the side of the road; local governments, the show implied, either don’t notice or don’t care.
These are demoralizing revelations for Chinese anxious to see the country’s food safety improve. They’re also unsettling for anyone concerned that China lacks the capacity to meet its laudable Covid-era commitment to dismantle the $75 billion wildlife breeding industry — spread out over tens of thousands of farms — where Covid-19 is thought to have originated. Until the country has fewer (and by extension, larger) farms, the government won’t be able to fully enforce those regulations.
If there’s good news, it’s that China has no intention of allowing small-scale farming and its associated problems to become the future of its agriculture industry. But fixing those problems will require as many as two decades, according to Chinese officials. Until then, consumers in China and elsewhere will have to carefully watch what they eat.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.