With some 50% of the economically active population engaged in farming, agriculture forms the foundation of China's economy. Limitations in topography, soil, and climate, however, have restricted cultivation to only about 14.5% of the total land area. Despite recent advances—grain crops totaling an estimated 457 million tons were produced in 1999 (22.1% of the world's total)—the enormous pressures of feeding and clothing China's vast and growing population remain among the country's most compelling concerns. From 1980 to 1990, agricultural output grew at an average annual rate of 5.9%, above the population growth rate and the first sustained expansion of agriculture since 1966; output increased at an average annual rate of 4.1% from 1990 to 2000.
The PRC government expropriated large landholdings in a land reform carried out in 1951–52, redistributing the land among poor peasants. By the end of 1954, 11.5% of all peasant households had been collectivized; by 1955, 65%; and by 1965, 99%. The Chinese collective farms had virtually no mechanical equipment, but the peasants pooled their labor in various projects, such as water management, which were beyond the capacity of individual peasants. In 1958, the collective farms were merged into larger units as people's communes. The communes were concerned not only with agricultural output but also with subsidiary farm activities, such as light industry and handicrafts, usually produced for local consumption.
Far-reaching changes in the organization of communes took place during 1961–62. Formerly, the production brigade (the major division of a commune), of which there were about 719,438 in 1982, was regarded as the commune's "basic accounting unit." In 1962, however, the production team (the subdivision of a commune) became the commune's basic organizational element. The average production team consisted of 33 households and cultivated about eight ha (20 acres). Production teams functioned almost autonomously, making basic decisions on production and distribution of income, while the commune mainly exercised the functions of a township government. Households, the final link in the system, were permitted the use of private plots, which made up about 5% of the arable land assigned to a team. In the early 1980s, these private holdings accounted for 19% of total agricultural output and the bulk of the country's production of vegetables, fruits, hogs, and poultry. Under the "responsibility system," which was introduced in 1978 and by 1983 was operating in 90% of rural China, all production in excess of assigned levels could be sold on the open market to yield a profit for individual production teams. In 1982, in addition to the rural communes, which provided most of China's agricultural output, there were 2,078 state farms working approximately 4.5% of all farmland. These farms, under the Ministry of State Farms and Reclamation, generally served as commodity production centers and as research units for the improvement of crop and livestock yields.
In 1983–84, a major reform of the agricultural system was launched. The 50,000 communes were disbanded and replaced by 92,000 townships, and the six million production brigades were broken up. Production decisions are now made by the household, which sets production targets in contracts with the government; households can sell their surpluses in the open market for cash. Crop diversification is encouraged. By the late 1980s, 60% of agricultural output was free of state controls, and most of China's peasants practiced the household responsibility system.
Grains are the chief crop, accounting for 70% of the total value of crop output and occupying 80% of all land under cultivation. Shandong, Jiangsu, and Henan together account for about 25% of the total crop value.
The main food crops are rice, wheat, and corn, followed by kaoliang (a type of sorghum), millet, potatoes, and soybeans. China is the world's leading producer of rice, with production increasing from 106.6 million tons in 1970 to an estimated 200.5 million tons (34% of the world's total) in 1999. Over 90% of all rice is produced in southern China, with two (and in the far south, three) crops being grown each year where irrigation facilities permit. Early rice is planted in April and harvested in July; single-crop rice is planted in May and harvested in September; and late double-cropped rice is planted in June and harvested in October. The total wheat crop in 1999 amounted to 114.4 million tons, more than double the 1970 output. Wheat is cultivated throughout the country, often as a dry-season crop in the rice-growing south, with specialized production centered in the Yangtze Valley and North China Plain. Output of other coarse grains, including corn in the southwest and drought-tolerant millet and kaoliang in northern and northeastern China, exceeded 142.1 million tons in 1999. Production of roots and tubers, including sweet potatoes grown as a second crop in areas south of the Yellow River and white potatoes in cooler areas north of the Great Wall, totaled 175.6 million tons in 1999.
Industrial crops occupy only 8–9% of the cultivated areas. Among the most important are cotton (the chief raw material for the important textile industry), various oil-bearing crops, sugar, tobacco, silk, tea, and rubber. Cotton output totaled 3.8 million tons in 1999, down from 5.6 million tons in 1991, with production concentrated along the middle and lower reaches of the Yangtze River and on the plains of the Yellow and Huai rivers. Oilseed output in 1999 was derived from a diverse assortment of widely grown industrial crops, including sunflower seeds (1,550,000 tons) and rapeseed (9,700,000 tons). Other oilseed products included 200,000 tons of castor beans, 550,000 tons of sesame seeds, and 420,000 tons of linseed in 1999. Sugar production reached 8.9 million tons in 1999, up from 1.8 million tons in 1974; an estimated 84% of all sugar is derived from sugarcane grown in the south, and the remaining 16% from sugar beets grown in the north and northeast. Production of tea, also an important traditional export, increased from 120,000 tons in 1956 to 723,000 tons in 1999 (25% of world production), with most of the tea grown in hilly regions of the south and southeast. Most tobacco is produced as a sideline by commune householders working private plots; output was 2.6 million tons in 1999. Most natural rubber is produced on specialized state farms; production totaled 440,000 tons in 1999.
The irrigated area is estimated to have increased from about 15.3 million ha (37.8 million acres) in 1950 to 52.5 million ha (130 million acres) in 1998, making China the world's leader in irrigated land. The expansion of fertilizer production is viewed as a key to major growth in the agricultural sector. Toward this end, China during 1972–74 contracted for the purchase of 13 large urea plants from Japan, the United States, and Western Europe. China's use of chemical fertilizers increased from 184 kg per ha in 1984 to about 291 kg per ha in 1998. Farm machinery in 1998 included 704,066 tractors and 114,000 combines.