Former World Bank Chief Calls on China to Stop Stockpiling Food and Fertilizer

Former World Bank President David Malpass told the BBC in May 2026 that China should stop accumulating food and fertilizer reserves, calling its stockpiles the "biggest world stockpile of foodstuffs and of fertiliser" [1]. The remarks, made on the eve of the Trump-Xi summit in Beijing, landed amid a global fertilizer shortage driven by the closure of the Strait of Hormuz and China's own March 2026 export ban on key fertilizer products [2]. Beijing fired back, with embassy spokesperson Liu Pengyu saying that "the root causes behind the current disruptions in global food and fertilizer supply chains are crystal clear; this blame cannot be shifted onto China" [1].

The exchange distills a question that has grown more urgent with each successive global food crisis: does China's policy of maintaining enormous strategic reserves stabilize or destabilize the global food system?

The Scale of China's Reserves

By any measure, China's grain stockpiles are extraordinary. According to USDA estimates cited by the Center for Strategic and International Studies, China held approximately 69% of global corn reserves, 60% of rice reserves, 51% of wheat reserves, and 37% of soybean reserves as of 2024 [3]. China's corn ending stocks alone were nearly five times those of the United States [3].

Source: USDA PSD / ChinaPower CSIS

Data as of Dec 1, 2024CSV

China's grain output reached a record 706.5 million metric tons in 2024, a 1.6% increase from the prior year [4]. Beijing raised its 2025 stockpiling budget by 6.1% to 131.66 billion yuan ($18.12 billion), signaling an intention to build reserves further even as global supplies tightened [5]. The OECD estimates China spent $10 billion on public stockpiling in 2023 — roughly 20 times what all OECD countries spent collectively [3].

State-owned enterprises Sinograin and COFCO manage what one analysis described as a reserve sufficient to "feed its population for one year," a stockpile without historical precedent in scale [6]. Industry sources have indicated that China's grain silos are full enough to forgo imports for at least two years [7].

Fertilizer: The Other Stockpile

China's role in global fertilizer markets has become equally contentious. The country accounted for 25% of global fertilizer production and exported over $13 billion worth of fertilizer products in 2025 [1]. Starting in October 2021, China imposed export inspection requirements and quotas on fertilizer shipments, initially citing soaring domestic coal prices and the need to ensure domestic supply [8]. A urea export ban followed in December 2023 [9].

In mid-March 2026, Beijing imposed its most sweeping restrictions yet, banning exports of nitrogen-potassium blends and certain phosphate varieties. Between 50% and 75% of China's fertilizer exports are now restricted, affecting up to 40 million metric tons of product [2]. Market participants expect the restrictions to remain in place until at least August 2026 [2].

Source: World Bank Commodity Price Data

Data as of Apr 1, 2026CSV

The timing compounded an already strained market. Disruptions to shipping through the Strait of Hormuz — which carries roughly one-third of global sea-borne fertilizer supply — had already pushed international urea prices up approximately 40% compared to pre-war levels [2]. Matthew Biggin, a senior commodities analyst at BMI, told reporters that "China prioritizes food security and insulates domestic markets from price shocks rather than rescuing global supply" [2].

The combined effect of China's export restrictions and Middle Eastern supply disruptions has hit import-dependent countries hard. India, which sourced more than 40% of its urea and DAP imports from the Middle East in 2025, has formally requested that China issue export quotas for urea [10]. Brazil, Indonesia, and Thailand each depend on China for roughly 20% of their fertilizer imports, while Malaysia and New Zealand rely on it for about a third [2].

Commodity Price Spikes and Chinese Import Surges

The statistical link between Chinese purchasing behavior and global commodity prices predates the current crisis. Between March 2020 and March 2022, prices of soybeans, wheat, and other grains surged 88%, driven in part by strong import demand from China [11]. China became the world's largest corn importer in the 2020/21 marketing year, accounting for 16% of global corn trade — up from an average of 3% in the preceding decade [11]. The surge was driven by efforts to rebuild hog herds following the African swine fever outbreak.

Research from the University of Illinois found that the October 2021 urea price spike was "largely due to surging energy prices," while the mid-2022 spike resulted from elevated energy costs combined with tighter supply during China's temporary urea reserve program [12]. At their peak in April 2022, global urea prices had risen roughly 250% from January 2020 levels. After partial stabilization in 2023-2024, they have climbed again in 2026 to approximately 160% above the 2020 baseline [13].

Russia's invasion of Ukraine in February 2022 amplified the crisis. Wheat and corn prices increased 25.7% and 24.8% respectively by June 2022, on top of already elevated levels [11]. Disentangling China's contribution from other factors — energy prices, the Ukraine war, pandemic-era supply chain disruptions — remains analytically difficult. The USDA has identified Chinese import demand as one of several contributing factors rather than a sole cause [11].

The Human Cost

The period of highest food price volatility coincided with a sharp rise in global hunger. An estimated 735 million people faced hunger in 2022, up from 618 million in 2019 [14]. While the figure declined to 673 million in 2024, it remains well above pre-pandemic levels [14]. Some 2.3 billion people experienced moderate or severe food insecurity in 2024, 336 million more than in 2019 [14].

Source: FAO SOFI Report

Data as of Jul 1, 2025CSV

The burden falls disproportionately on the poorest countries. In Africa, more than 20% of the population — 307 million people — faced hunger in 2024 [14]. The number of people in low-income countries unable to afford a healthy diet rose from 464 million in 2019 to 545 million in 2024 [14].

Quantifying how much of this suffering traces specifically to Chinese stockpiling is difficult. The FAO and World Bank have attributed recent food insecurity to a confluence of factors: conflict, climate shocks, economic disruption from COVID-19, and the Ukraine war [14][11]. No major institutional study has isolated Chinese stockpiling as the primary driver, though several analyses identify it as a contributing factor through its effect on tightening global supply and elevating baseline prices [3][8].

The Case for China's Reserves

China's defenders point to a set of structural realities that make large reserves rational. China feeds roughly 18% of the world's population on approximately 9% of its arable land [3]. The Great Chinese Famine of 1959-1961, which killed an estimated 15 to 55 million people, remains within living memory of the country's oldest generation and deeply embedded in policy thinking [6].

Climate risks are mounting. China has invested $757 billion in water conservation under its 14th Five-Year Plan and deployed over 300,000 agricultural drones — more than half the global total — to improve yields [6]. These investments reflect genuine vulnerability: a single bad harvest in a country of 1.4 billion people would create import demand that could overwhelm global markets far more than steady stockpiling does.

The FAO recommends a carryover ratio — the ratio of end-of-year stocks to annual consumption — of 17-18% as a minimum for food security [15]. China's grain stocks-to-use ratio has been estimated at over 80% for wheat and over 65% for corn, well above the FAO floor [7]. Whether this constitutes prudent insurance or excessive hoarding depends on how one weighs China's unique demographic and geographic constraints against the impact on other countries' access to affordable food.

The geopolitical context has also shifted. U.S. export controls on technology, the trade war, and now the Iran conflict have reinforced Beijing's conviction that supply chain reliability cannot be taken for granted. As one Geopolitical Economy Report analysis argued, China's purchases during 2024-2025 — which The Economist criticized as "wasting billions of yuan" on commodities at premium prices — now look prescient given 2026 price increases [6].

Who Is David Malpass?

Malpass served as World Bank President from 2019 to 2023, having been nominated by President Donald Trump [16]. Before that, he was Treasury Under Secretary for International Affairs from 2017 to 2019. He resigned from the World Bank in June 2023 after facing criticism over his stance on climate change, following comments at a public event where he declined to affirm that fossil fuel burning was warming the planet [16].

Since leaving the World Bank, Malpass has served as Distinguished Fellow of International Finance at Purdue University's Daniels School of Business and has been a regular commentator in Forbes and the Wall Street Journal [17]. He has focused on debt transparency, Federal Reserve policy, and emerging market economics.

Malpass's call for China to draw down its reserves came alongside a broader critique of China's claim to developing-country status at the WTO: "They present themselves as a developing country when they're the second biggest economy in the world and in many ways rich" [1]. This position aligns with longstanding U.S. trade policy rather than representing a novel analytical claim.

Independent economists have offered mixed assessments. The IFPRI (International Food Policy Research Institute) has noted that Chinese demand is one factor among many in global price volatility, while emphasizing that export restrictions by multiple countries — not just China — were a more direct driver of the 2021-2022 crisis [8]. A 2023 WTO report found that many G20 export restrictions on food and fertilizer remained in place years after being imposed [18].

International Legal Frameworks — or Lack Thereof

No binding international law limits how much food or fertilizer a sovereign nation can stockpile. The WTO Agreement on Agriculture addresses public stockholding for food security, but primarily through the lens of domestic support subsidies rather than stockpile size [19]. When governments purchase food at administered prices above market rates, the spending counts toward their ceiling on trade-distorting domestic support.

An interim "peace clause" adopted in 2013 protects developing countries from legal challenges when their food stockholding programs breach subsidy commitments [19]. This clause was meant to be temporary, with a permanent solution expected by 2017. Nearly a decade later, WTO members remain deadlocked on key issues: product coverage, country eligibility, transparency requirements, and mechanisms to prevent excess stocks from distorting trade [19].

The G20 established the Agricultural Market Information System (AMIS) after the 2007-08 food price spikes to improve transparency in commodity markets [20]. China participates in AMIS but does not publicly disclose the full extent of its grain reserves, which are treated as a state secret. This opacity frustrates international monitoring and fuels suspicion about the true size and purpose of the stockpiles.

At the UN Committee on World Food Security, China has consistently argued that food stockpiling is a sovereign right essential to national security. Beijing has resisted proposals that would impose binding transparency obligations on reserve levels, while supporting voluntary information-sharing frameworks [19].

What Would Drawdown Look Like?

If China were to reduce its grain reserves toward the FAO-recommended 17-18% stocks-to-use ratio, the release of hundreds of millions of tons of grain onto global markets would have significant price effects. The direction would depend entirely on the timeline.

A rapid, uncoordinated drawdown could crash prices for wheat, corn, and soybeans, harming farmers in exporting countries like the United States, Brazil, Argentina, and Australia. Grain-exporting sectors that have expanded production to meet perceived demand would face oversupply. Conversely, importing nations — particularly in Sub-Saharan Africa, South Asia, and Southeast Asia — could benefit from lower prices in the short term.

A gradual, managed drawdown over several years would moderate these effects. The IFPRI and other research institutions have generally argued that transparent, rules-based reserve management — where countries commit to target levels and publish stock data — would reduce the uncertainty premium built into global commodity prices [8].

On fertilizer, lifting China's export restrictions could provide more immediate relief. Urea and DAP prices would face downward pressure, benefiting farmers in India, Brazil, and across Africa who have reduced fertilizer application rates due to cost [2]. Yara International's CEO warned that sustained supply disruptions could affect "10 billion meals weekly" worldwide [1].

The Interaction of Export Bans and Import Stockpiling

Analyzing China's fertilizer export restrictions in isolation from its import-stockpiling behavior understates the net effect on global markets. China simultaneously restricts outbound shipments of fertilizer it produces domestically while importing raw materials — including potash from Canada and Belarus, and phosphate rock from Morocco — to feed its domestic industry [9].

Source: BLS / Bureau of Labor Statistics

Data as of Mar 1, 2026CSV

The result is a one-way valve: global raw materials flow into China, finished fertilizer does not flow out. Between 2021 and 2023, urea exports from Egypt, Nigeria, and the United States rose nearly 50% as other producers scrambled to fill the gap left by Chinese restrictions [8]. But this diversification has limits. China's scale — 25% of global production — means no combination of alternative suppliers can fully substitute for its output in the near term.

The 2026 restrictions have tightened this dynamic further. With Hormuz disruptions removing Middle Eastern supply and China withholding its own, the global fertilizer market faces its most constrained conditions since 2022. The U.S. Food CPI, already up 2.7% year-over-year as of March 2026, reflects the early transmission of these input cost increases to consumer prices [21].

Where This Leaves the World

The debate over China's stockpiles sits at the intersection of national sovereignty, global equity, and market economics. Malpass and his allies see a country that is rich enough to stop hoarding and responsible enough to share. Beijing sees a country that has learned — from famine, from sanctions, from trade wars — that self-reliance is not optional.

Both positions contain truth. China's reserves exceed any reasonable international benchmark, and the opacity surrounding them adds a risk premium to global commodity markets. At the same time, the current crisis was triggered by a war in the Middle East and amplified by decades of underinvestment in agricultural resilience across the Global South — factors that have nothing to do with the number of tons sitting in Sinograin's warehouses.

The absence of binding multilateral rules on strategic reserves means this argument will be settled — if it is settled at all — through bilateral diplomacy and market forces rather than international law. The Trump-Xi summit may produce a fertilizer export arrangement; it may not. What it will not produce is a system that prevents the next crisis from playing out the same way.