Is China preparing for war? Soaring food, gold stockpiles an ominous sign
China’s has opened the floodgates to imports of critical food supplies, causing some geopolitical experts to speculate the ruling party is preparing for war.
According to commodity data provider SunSirs, data being compiled on wheat imports for the month of April is expected to show shipments to the Chinese mainland hit 1.68 million tons, an enormous year-on-year increase of 141%.
It’s believed the April data will be the largest single-month volume of Chinese wheat imports on record.
SunSirs also estimates from January to April 2023, China imported 6.03 million tons of wheat, an increase of over 60% compared to the same period in 2022.
SunSirs says its data is collected from transaction information from more than 100,000 market participants and three key China futures indexes – the Shanghai Futures Exchange (SHFE), Dalian Commodity Exchange (DCE), and Zhengzhou Commodity Exchange (ZCE).
China on a war footing?
On Chinese social media platform WeChat, the high volume of food imports has been a trending topic.
“Have heard the CCP asked importers to ship as much grain and sugar as possible, and importers are able to avoid tariffs for quick shipments,” wrote one Chinese commentator.
While some suggest the sudden surge in grain imports is due to a poor domestic harvest season, others believe the stockpiling of grains, sugar, and oil, along with the hoarding of gold seen in recent years, proves China is on a war footing.
“China’s going to go to war, I don’t know how else you can put this, this is a regime that wants to go to war, it knows better but nonetheless there is a blood lust there… How many times do you have a militant regime on a breakneck build-up then doesn’t go to war?” said Gordon Chang, the author of The Great U.S.-China Tech War, in a recent interview.
At China’s National People’s Congress in March this year, President Xi Jinping announced a 7.2 percent increase in China’s defense budget. In the subsequent months, the party has announced new military readiness laws, opened new air-raid shelters in cities near Taiwan, along with new National Defense Mobilization offices across the vast country.
In an article for Foreign Affairs, Chinese political experts, John Pomfret and Matt Pottinger, noted these developments – along with the fact Xi Jinping has publicly told Generals they must “dare to fight” – need to be taken seriously.
It is too early to say for certain what these developments mean. Conflict is not certain or imminent. But something has changed in Beijing that policymakers and business leaders worldwide cannot afford to ignore. If Xi says he is readying for war, it would be foolish not to take him at his word.
Gold hoarding another sign of imminent China war?
As has been highlighted by Asia Markets, unusual patterns of price movements in global gold markets has opened the door for China to greatly increase gold reserves in recent years.
Dominic Frisby, a gold commentator has previously said he believes China now holds more gold than the United States, following the recent period of enormous accumulation.
“This is in my view is the biggest story in global finance, and yet nobody is reporting on it,” Mr Frisby said.
“Both Russia and China have known they must de-dollarize for some considerable time, which is why both have been so steadily increasing their gold holdings.”
Alasdair Macleod, the head of research for Goldmoney believes China’s hidden gold could amount to 20,000 tons, more than double the United States.