China’s land grabbing from world-ecology: the quest for cheap soybean, rice and sugarcane and the limits to capital accumulation

Abstract

The surge in land investments unleashed by the escalating food prices during the 21st century coincided with the priority that the People's Republic of China assigned to the control of lands in other territories in order to respond to its food demand, accentuated by its consolidation as a pole of global accumulation. While the literature questioned the real magnitude of China's participation in the process and explored the causes that led these initiatives to failure, the significance of China's land grab within the dynamics of capitalist accumulation has not been studied enough. Similarly, how the limits that emerge as a result of the environmental crisis affect the implementation of these projects, and with it, the possibilities of accumulation, has not been explored either.

This paper investigates the implications of China's land grabbing for food purposes around the world on the process of capitalist accumulation. With that aim, it studies China’s overseas land investments for the production of soybeans, rice and sugarcane in the period 2000-2019. Drawing on Jason Moore's world-ecology approach, it is argued that China’s land grabbing expresses and intensifies the contradictions in the process of accumulation. On the one hand, it expands the participation of Chinese agribusiness in the financialized food system in order to appropriate the lands essential to meet the food needs of its workers and its middle class. However, on the other hand, the high costs that the environmental crisis imposes on these projects not only limit their implementation, but also the possibilities of a new expansion of capitalism.

In terms of methodology, due to data limitations, the evolution of China’s land investments is analyzed through information provided by Land Matrix database. Since this paper focuses exclusively on initiatives linked to the production of soybean, rice and sugarcane for food purposes—the three crops that were concentrated in the land deals in terms of hectares involved— it examines 61 land deals around the world. Additionally, press information and academic publications are used to discuss certain cases in more detail.

The paper characterizes land grabbing as a response to two current features of the capitalist world-ecology: the end of cheap food and the hegemony of finance capital. The variety of interests around land resulting from both dynamics unleashes a competition to open up the remaining frontiers in the world through land grabbing to appropriate the cheap food that could renew accumulation. Additionally, it introduces the notion of negative value to explore how this outcome can be restricted by the emergence of limits rooted in the environmental crisis that obstructs the restoration of cheap food.

In this context, China's involvement in land grabbing is understood as a manifestation of the dynamics inherent to the development of capitalism after its consolidation as a pole of global accumulation. In order to open up new avenues of accumulation, China promoted the expansion of its agribusiness corporations and the search for investment opportunities in land around the world through the Going Out strategy. This encouraged the opening of frontiers in other territories that would allow China to access cheap food to overcome the biophysical limitations and high costs of domestic agricultural production as well as to reduce imports. However, due to China's distrust of highly concentrated and financialized agricultural markets, another key determinant of these projects was the interest of Chinese agribusiness in increasing its power in the food system to compete with the large grain traders. Both elements explain why rice, soybeans and sugarcane have concentrated Chinese land investments. These crops are not only crucial to China's food security, to the point that it has become one of the largest consumers and importers in the world, but also in that the latter two are highly coveted by finance.

The investments examined show that Latin America and Eastern Russia became the frontier par excellence for soybean production as these regions registered the highest number of agreements linked to this crop in the world. In contrast, the production of rice and sugar cane concentrated in Africa and Asia. Access to these crops is inseparable from the maintenance of China’s global leadership in pork and poultry production, as well as the opportunities that the diffusion of hybrid rice and access to cheap sugar cane would provide for seed companies and the processing industry respectively. This demonstrates the unity between accumulation, power and nature that defines world-ecology. 

However, this paper found that a significant number of these projects never came to be implemented. This failure can be attributed to the high costs of the initiatives, which hinder their original purpose: the access to cheap food. This is an expression of the negative value that emerges from land grabbing due to the environmental crisis. The location of projects on the remaining external frontiers forces Chinese companies to internalize the environmental degradation present in those areas. The need to convert land that is degraded or unsuitable for agricultural production requires an intensification of the application of increasingly toxic and destructive technologies and inputs, which dramatically raises the costs of the projects. More seriously, sometimes even the use of these techniques is not enough to control the resistance of nature to capital in the form of climatic events such as droughts and floods, epidemics, or the unsuitability of soils for hybrid crops.

It is worth noting that not only does environmental degradation represent a constraint to land grabbing, but that, conversely, land grabbing accentuates the degradation of nature, which casts serious doubts on the effectiveness of this strategy for access to cheap food. In brief, the environmental devastation inherent to land grabbing exacerbates the contradictions of capitalism in a context where the absence of new frontiers hinders the possibilities of accumulation. The conclusions suggest that future research should incorporate other actors and crops, including non-food crops, to develop a better understanding of the effectiveness of land grabbing in restoring cheap nature. In addition, it is necessary to explore the new frontiers that may result from the failure of China's land grab. Finally, more rigorous study is needed on how land grabbing activates negative value.