Floods and Fires Collide: China's 2026 Grain Deficit Set to Hit 45.19 Million Tons! Natural Disasters Cut Yields by 12.45 Million Tons, While Grain Reserves Magically Evaporate by 31.20 Million Tons—Man-Made Disasters Twice the Size of Mother Nature! 'Circular Grain', 'Air Grain', and Mysterious Granary Fires: Have You Stockpiled Food Yet?
The video starts with food demand elasticity, international shipping and fertilizer costs, and the impact of extreme heat and floods on yields to estimate the global and Chinese food production decline in 2026, while questioning the Chinese Communist Party (CCP)'s food reserve data. The content focuses on the issues of 'circular grain' (grain sold and bought back to fake inventory), 'air grain' (non-existent grain), falsified loss reports, and mysterious fires in grain depots. It claims that with the combination of natural disaster-induced production drops, inventory shortfalls, and blocked Black Sea shipping, the Chinese food system may face a gap of 45.19 million tons under extreme stress tests, and analyzes the impact on feed, hog farming, food prices, and monetary policy.
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During the period of the perverse Zero-COVID policy and lockdowns, it wasn't as if people didn't starve to death, so everyone should still be prepared to mitigate this risk.
Since the beginning of this year, the frequency of disasters has arguably broken records. There is flooding everywhere in China, and fires are breaking out everywhere internationally—the U.S. is on fire, Canada is on fire, and France has also seen major fires. Today, we are going to talk about something that usually receives little attention: the food issue. The CCP has food reserve data, but I grew up in Northeast China, a major grain-producing region, and I know all too well what kind of people these bastards in the grain stations and grain bureaus are. Every single grain station and depot in the Northeast is a disaster area for long-term fraud; as soon as these Chinese officials in the grain sector are investigated, every single one of them ends up in jail.
In the past, when China suffered disasters, it could solve the problem through food imports. Now, major global grain-producing regions are either suffering from disasters or embroiled in war, and China is the world's largest food importer. Under these circumstances, is China's food supply still sufficient? This is worth discussing, and I will calculate it carefully.
Everyone should remember a rule: the lower the production elasticity of a commodity, the harder it is to stabilize it in a short period once it enters an extreme volatility range. For example, with industrial product prices, the closer you get to the upstream, the worse the price elasticity becomes. Looking at the industrial chain, the most volatile sector is mineral extraction, because mineral production capacity is difficult to increase in a short time; manufacturing capacity has relatively more elastic space, so the price volatility of finished products is not as high.
Agricultural production capacity has even worse elasticity than mineral extraction because this stuff often depends on the weather. How much grain a mu of land can produce has basically zero elasticity in the short term. Even if you increase the cultivated area now, the growth cycle of grain takes at least half a year. Therefore, grain is the commodity with the lowest elasticity and the highest political weight among all bulk commodities. Today, we will calculate this from start to finish: first, calculate why grain prices are inherently explosive, then calculate how much the harvest will be cut by natural disasters this year, and then open up China's grain depots to see how large the gap is between the grain on China's books and the actual grain holdings.
Food as a commodity has a very special attribute: its demand is rigid to the extreme. The price elasticity of demand for this stuff—in plain language, how much less you buy after a price hike, or the relationship between the magnitude of the price hike and how much less you buy—is minimal. For luxury goods, like mobile phones, even if the price goes up, you can choose not to upgrade, but if food prices go up, you still have to eat.
Here is the elasticity data for various grain varieties. The lower the elasticity, the greater the rigidity. The elasticity of wheat is only 0.035, and rice is 0.001, which is almost zero elasticity. Soybeans and corn are special because they can be used as feed or industrial raw materials, so their elasticity is slightly higher, but still only between 0.1 and 0.2. The elasticity of soybeans and corn is higher because pigs can eat a little less, and starch factories can also reduce production; wheat and rice are entirely human food, with no room for retreat, so their elasticity is firmly pressed near zero.
Elasticity approaching zero means there is a huge lever embedded in the price. This year, the main wheat contract rose from 500 at the beginning of the year to 680, a direct increase of 36%. Can you guess how big the supply gap is behind this? Using elasticity to reverse-calculate, it is only 1.26%. You heard that right, the supply side only decreased by 1.26%, or even if the market just expects it to decrease by that much, the market can amplify it into a 36% surge. Moreover, the gap does not need to be realized at all; as long as it is credible, it is enough.
Traders start hoarding goods when they see prices rising, and exporting countries start restricting sales when they see prices rising. Everyone's self-preservation actions turn expectations into reality; this is the self-fulfilling prophecy of inventory anxiety. Therefore, the grain gap does not actually need to be very large; as long as it exists, the price is enough to skyrocket.
Let's talk about the cost side of grain planting this year. The gap hasn't been calculated yet, but the accounts have already exploded. Once the Strait of Hormuz is hit, 20% of the world's liquefied natural gas and about 30% of urea and synthetic ammonia exports are stuck at that bottleneck. Once natural gas is cut off, the synthetic ammonia production capacity in the Middle East and North Africa will directly collapse. Urea prices jumped 30% in a short period, rising to 620 US dollars per short ton. American futures use the short ton unit; one short ton equals 907 kilograms, which is about 91% of a standard ton.
Shipping costs are also rising. Lloyd's increased the war risk premium in the Persian Gulf from 0.5 to 2 per thousand of the ship's value to 1.5% to 3%, a full 20-fold increase. War insurance for ships with backgrounds from the United States, the United Kingdom, and Israel has risen to 9%. In other words, for a large ship worth 100 million US dollars, the insurance premium for just one trip is 3 to 9 million US dollars.
If all these are factored into the price of grain per ton, urea alone increases the cost by 21 dollars, oil insurance for detoured routes increases it by 18.5 dollars, and war insurance increases it by 93.5 dollars, totaling an additional 114 dollars in delivery costs per ton out of thin air. Compared to the landed price of corn at 260 dollars per ton, this is a 44% cost push. So now you can get a sense of the global grain situation: even if not a single grain has been reduced, 40% of the money is already gone. On the cost side, this is a geopolitical tax that the whole world has to pay together.
After calculating the costs, let's look at the yield. This is an internationally accepted climate and yield estimation model. To understand this formula, we only need to grasp one core concept: there is an absolute critical line for temperature damage to crops. Throughout the growing season, as long as the daily maximum temperature is below this critical line, the formula determines that the heat damage for that day is zero, with no yield reduction penalty. The real lethality is entirely concentrated in the days after crossing the critical line.
Once the temperature crosses the line, the formula extracts the excess degrees and performs a square operation. This means that if the temperature only exceeds by 1 degree, the damage can be calculated as 1; but if it exceeds by 5 degrees, the impact on crops will instantly soar to 25 times. The more it exceeds the limit, the more severe the yield deduction. Finally, by adding up the exponentially magnified losses for every day of the entire season and multiplying by a coefficient, you get the final cost of yield reduction for that plot of land.
The truth described by the entire formula is that the real threat of extreme weather is not how hot it is on average, but that once the physiological limits of crops are crossed, the speed of yield collapse is extremely steep and irreversible. This is the physiological death red line for each crop: 29 degrees for corn, 30 degrees for soybeans, and 32 degrees for wheat and cotton. Below the red line, there is basically no impact on yield; once the red line is penetrated by the daily maximum temperature, especially during the pollination and grain-filling window, pollen will directly lose its activity. This damage is physiological and irreversible; no matter what genetically modified seeds you change to, it cannot be saved.
This year, we have encountered a super El Niño, and the world's four major granaries are all having problems. The heat in the US Midwest was stuck above 37 degrees for 14 consecutive days in July. This year's lethal temperatures deviated directly by 2.9 standard deviations from the norm, the drought index in the Black Sea production area fell directly below the warning line, and it was superimposed on the Russia-Ukraine war, with water conservancy facilities basically destroyed. Precipitation in the South American Pampas was 128 millimeters less than normal, and the drought in southern India further exponentially widened the gap in rice irrigation in the model.
Plugging these measured meteorological data into the model and stripping away the natural growth of about 1.20% in technological progress each year, the global output of the four major staple foods cut by pure climate factors is 44.38 million tons. This model is not a guess, but calibrated by historical data, with measurement errors controlled between 15% and 20%. The 95% confidence interval given by 1 million Monte Carlo simulations is 35 million to 56 million tons, with a median of 44.38 million tons.
What is the concept of 44.38 million tons? It is almost the annual food ration for more than 200 million people, evaporated in one summer—not even a whole summer, I should say.
Now let's calculate China's grain production. China's grain production must be modeled separately because natural disasters in China are never confined to just one place. When a county is flooded, the logistics, flood damage, and even pest infestations in neighboring counties are also affected. Guangxi presents an even more extreme situation: there are many venomous snake breeders there, raising snakes to extract venom, as snake venom is a raw material for many biopharmaceutical companies. Once a flood hits, the water in the videos is full of king cobras raising their heads, all having escaped from breeding farms. How can such land still be farmed? Therefore, when building the model, one cannot look only at the disaster-stricken area; all associated impacts must be factored in.
Crucially, all the decorations in the CCP's reports designed to make the data look good must be stripped away. We ignore the CCP's grain reserve data and look only at the solid, actual reduction of grain in the fields. The resulting figures directly point to two major disaster areas.
First, let's look at the Huang-Huai Plain. Winter wheat in Henan and Shandong hit its crucial grain-filling stage, which requires the most water, just as it encountered dry-hot winds. For a consecutive week, the daily average temperature stayed above 32 degrees Celsius, nearly baking the wheat into dried stalks. The wheat kernels become extremely shriveled, lack weight, and suffer a drastic drop in nutritional value. In this region alone, the actual production reduction reached 2.18 million tons.
Northeast China is in an even worse state now, with roughly a quarter of the Northeast submerged in water. Heilongjiang and Jilin are the core production areas for corn and soybeans, and now 12% of them are directly soaked in water. Even if the water recedes now, with the fields soaked for so long, the crop roots have long rotted, so this production area is bound to suffer a total crop failure. This single area abruptly wiped out 8.55 million tons of production.
All things considered, the baseline for the country's actual reduction in production is 12.45 million tons, a 2% drop compared to last year. This does not even account for the losses of smallholder farmers. If smallholder losses are added, the figure will certainly head toward 15 million to 18 million tons. But let's not count those and stick only to 12.45 million tons, making this a baseline figure.
When autumn arrives, the CCP will definitely lie to you. Later on, at the autumn harvest press conference, you don't even need to think about it—the CCP's narrative will still be a bumper harvest. Mainly because this year, whether it's the economy or government debt, everything is fucking garbage. If grain production drops as well, online commentary from ordinary people will turn into the style of Dong Zhongshu. When the right occasion arises, I'll give you fucking brothers a quote from Dong Zhongshu.
Dong Zhongshu's original quote is: "When a state is about to lose its way and fail, Heaven first sends down disasters to reprimand it; if it fails to reflect on itself, it then sends down anomalies to frighten it; and if it still fails to change, destruction and defeat will arrive." Translated into four words: the Son of Heaven loses his virtue. Therefore, fucking brothers, even if the GDP data stops being falsified, grain production must still be faked. Grain production is directly tied to the performance evaluations of local officials, and the falsification of grain production is an inevitable result driven by the institutional instinct of the CCP officialdom from top to bottom.
Now I am going to tear off the CCP's fig leaf first. Let's look at the CCP's grain reserve data. The CCP claims that static grain reserves exceed 650 million tons, which sounds exceptionally impregnable. Yet these 650 million tons are entirely on-book figures. If these 650 million tons were true, it would translate to two and a half years of the nation's food rations, which sounds like plenty no matter how you look at it.
The problem is that in a crisis, what is needed is not the number written on the books. Back when large-scale starvation occurred in Xinyang, the granaries were full of grain, and right there in the local Xinyang granaries. But the CCP simply refused to release the grain, which led to entire villages starving to death. In other words, even when there was grain in the CCP's granaries, there were situations where corpses littered the field. Moreover, no one knows what the situation in the granaries is like right now.
Even if the grain could be dispatched immediately, what stands between the CCP's accounts and the real grain? Tens of thousands of grassroots granary bureaucrats. The CCP's grassroots hold actual executive power; in the CCP's system, do you believe I would say they have no corruption whatsoever? This kind of thing is nothing new in the Northeast.
Have you ever heard of "recycling grain"? It's when these bastards at the granary haul out old grain for a spin and sell it back to themselves as new grain, all to pocket the price difference between new and old grain, and then collect the storage subsidy all over again. Recycling grain is considered relatively conscientious. The most monstrous ones are "air grain," which involves forging various warehousing documents and collecting full storage funds while the warehouses are completely empty.
The most covert is the loss rate. The true natural loss rate of modern granaries is about 1%, but the CCP's policy allows for about 3.5%. The 2.5% in the middle becomes a steadily recurring book deficit year after year. Furthermore, the losses on the reports are distributed so evenly across quarters that it looks like they were drawn with a ruler; the CCP has evolved to the point where it can make the natural loss rate obey. This evenness itself is evidence of a crime.
Even more ruthless are the supporting moves: after dumping the grain, they simply set it on fire, and then it all becomes reasonable loss. Therefore, granary fires are basically used for clearing accounts.
Let me give you another set of data. In 2022, when the CCP investigated the Heilongjiang granaries, it filed cases against more than 1,000 people in a single year, and grain bureau chiefs from 8 counties stood in line to go to prison. What does that concept mean? The CCP's discipline inspection wasn't looking for worms in the granaries that year; they were looking for granaries that hadn't gotten into trouble yet among all the worms. That's how exaggerated it is.
Just how big is the real hole? Relying solely on official records is not enough; we have to resort to other means. Back in the day, the Chinese Communist Party launched a project using satellite data to analyze the actual grain reserves in granaries. At that time, satellites scanned 1,200 key granaries across North and Northeast China. The specific method involved using satellite radar to measure the sagging of the roof panels—because the weight of the grain causes a degree of subsidence—and then using infrared to measure nighttime thermal radiation. Grain has both physical weight and its own temperature; an empty granary can absolutely never fake this kind of data.
The moment it was measured, the facade crumbled. For a large number of granaries listed on reports as being full, the roof subsidence data simply did not match up statistically. This satellite-measurement method has an accuracy rate of over 80%. While it might not be enough to serve as evidence in a court of law, it is already more than enough statistically.
Such an audit revealed that, within the audit baseline, 1.5% of the granaries were completely empty, another 2.5% had fabricated losses, and 0.8% contained wasted grain that was completely unusable. Adding these three items together means that there is a perennial hidden deficit of 4.8% between the grain recorded on the books and the inventory that can actually be pulled out at any moment.
What does 4.8% mean when applied to the country's total pool? It amounts to 31.2 million tons, equivalent to half a month's rations for the entire national population. This portion of grain does not exist at all; it lives only in Excel spreadsheets. As calculated earlier, natural disasters caused grain production to drop by at least 12.45 million tons, but the amount of grain that mysteriously vanished from granaries reached 31.2 million tons—meaning the losses caused by man-made disasters are 2.5 times those caused by nature.
China's greatest food security risk has never lain with the heavens, but rather within the CCP's ledger.
Now, as misfortune would have it, another black swan has just flown in: Russia and Ukraine are attacking each other's grain ships and export ports in the Sea of Azov and the Black Sea. Ukrainian drones struck 116 ships in 9 days. According to maritime safety agencies, the density of these attacks has already surpassed the level of tanker attacks during the Iran-Iraq War.
Extrapolating based on this attack frequency, the probability of this corridor falling into a substantive blockade within the next 90 days is as high as 92%. This is model-based data, not news-based speculation. With attack density reaching this level, who is still going to sail? Right now, this grain export port is busier than the fucking Strait of Hormuz; it is safe to say it is basically blocked dead.
For China, this is the most direct port. China is the world's primary grain importer, but people may not realize just how high China's foreign grain dependency is. Barley imports are 13 times domestic production, and sorghum is 3.2 times. At the peak of corn imports, 29% came from Ukraine.
Shipowners are now being very direct as well, initiating large-scale contract breaches and directly withdrawing their vessels to stop operations. Our model calculated the numbers: China's actual delivery schedule this year will have to stubbornly shoulder a transport capacity paralysis lasting up to a month and a half, resulting in about 1.54 million tons of grain failing to arrive at port on time. Looking at the absolute number alone, it certainly doesn't seem large, but this matter is stuck at a critically fatal point in time—right when domestic production has suffered solid drops and granaries are riddled with fabricated reports and deficits.
It is never the heaviest straw that breaks the camel's back, but the final one. To fill the gap, China has rushed frantically to source spot goods urgently from South America and North America. The four major international grain merchants, seeing that you are in a desperate rush, directly capitalize on the situation by raising prices on the spot, forcibly charging an extra $42.50 per ton as a spot-market urgency fee.
Now let's tally the grand total. China suffered an actual reduction of 12.45 million tons from natural disasters, the hidden deficit discovered in granaries is 31.2 million tons, and the shortfall from ports due to the cut-off of the Black Sea route adds another 1.54 million tons. Combining these three accounts together under extreme stress testing, China's absolute grain system deficit in 2026 reaches 45.19 million tons.
This algorithm is a form of extreme stress testing. The 31.2 million-ton hole in the granaries is a historical legacy problem accumulated over many years, not something that just vanished today. I put the inventory deficit and this year's flow shortage in the same table to show everyone that in the worst-case scenario, when there is a genuine need to urgently dispatch grain across regions, one will collide with a wall this hard—and that is 45.19 million tons.
Let's also look at how large the denominator is. China's baseline annual ration is 250 million tons, and adding the feed industry for pig farming and other uses which must swallow 280 million tons of corn and soybean meal annually, both of these sectors constitute extremely rigid demand from which not a single ton can be squeezed out. A deficit of 45.19 million tons crashing into this total pool accounts for roughly 5.5%.
Recalling the leverage ratio mentioned at the beginning, a mere 1.26% deficit can leverage a 36% surge in prices; now we are facing a 5.5% deficit. How will this final bill drain the wallets of ordinary Chinese citizens? The existing hog-raising cycle has about a 6-month buffer period. Once this momentum passes, pig feed costs will rise by at least 12%.
Right now, raising pigs in China is utterly miserable; live hog prices are under 5 yuan per jin, and farmers cannot sustain continuous losses, forcing them to slaughter sows and scale back production. If the industrial chain continues to transmit this, after a lag effect of about six and a half months—by the first quarter of next year—the entire CPI food category will be solidly pushed up by 115 basis points.
This grain shortage may not starve people to death, but by next spring, it will accurately and punctually reflect on the receipt when you go to the supermarket to buy groceries. Therefore, if you see abnormal CPI surges next year, what must you look at first? You must look at food. This is functionally equivalent to raising China's overall economic costs across the board, discounting the relative real income level specifically in the category of food once again.
Now let's piece these accounts together. On the price side, even if not a single grain of rice is lost in the fields, grain prices can still be forced up by 40%. On the production side, once the critical threshold is crossed, every degree above it burns through grain like crazy; if the harvest fails, it fails, and not even a god can save it.
Natural disasters are at least visible, and the losses can be calculated. The biggest black hole is actually whether there is any grain in the CCP's grain reserves, and exactly how much. The biggest gap is not in the farmland, but in the CCP's account books. The losses caused by man-made disasters are actually more than 2.5 times those of natural disasters.
If food price hikes really push up 115 basis points, it will put the CCP's central bank directly on the fire. To curb inflation, they must tighten monetary policy; but tightening monetary policy at a time like this would directly strangle an economy that is already half-dead. This is the most ruthless part of managing these accounts: the medicine for one end is the poison that kills the other.
Therefore, everyone should still stock up on some food at home. If nothing else, at least enough for the family to eat for three months. If there is a real grain shortage when the time comes, you can't count on some fucking idiot who carries a load for ten miles without switching shoulders to deliver it, can you? During the extreme zero-COVID policy and lockdowns, it's not like people didn't starve to death. So everyone should still be prepared to resist risks.