To farmers, agriculture is a business; for peasants, it is a way of life.   For the last thirty years, Chinese peasants have migrated to coastal cities in search of better pay, working as migrant workers at construction sites and factories.  They bring with them blankets and stoves as they live in the building that is going up!   Some 68,000 factories were closed down in the wake of the Great Recession of 2008 causing layoffs in the millions.

Meanwhile, farms in the hinterland were converting to cash crops for exports instead of growing staples like rice and wheat.  One such crop is mandarin orange in Hunan.  This turns out to be a double whammy!  Price is uncertain for the mandarin orange crop.  IN 2009. a small cosmetic issue with the crop caused consumers to stop buying in the markets.  Meanwhile the merchants bid down the price some 80% as the fresh market became glutted.  At the same time, prices for wheat and rice are rising rapidly, hence the recent monetary tightening to contain inflation so that the peasants are not radicalized.


About joseph1ng

Trained as a historian at Stanford, certified as an accountant, geeky by nature, CFO with U.S. and Chinese companies. Lived in Beijing, Shanghai, Tokyo but mostly in the Silicon Valley. China's $3 trillion foreign currency reserve will be deployed buying brands to bridge their supply chain to consumers.
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