This paper explores rural household food consumption behaviour in China using a
large household data set from Jilin Province. Data are classified into four main food
groups—grain, vegetable products, animal products and other foods. A household
food demand system, incorporating four household characteristics, is estimated using
an LA-AIDS model, assuming a three-stage budgeting procedure. Expenditure
elasticities for a range of food groups are estimated, with a particular focus on animal
products. The inclusion of household characteristics did not have a big impact on the
elasticity values in any of the three stages of the budgeting process. The total
expenditure elasticity for grain (stage II) was 0.64, suggesting substantial future
growth in household demand for fine grains such as rice and wheat, as per capita
incomes continue to grow in rural areas. The highest conditional and total expenditure
elasticity values were for the animal products (stage II) group, 1.22 and 0.76
respectively. Within this group the elasticities were highest for the meat sub-group at
1.14 and 0.87 respectively, suggesting an almost proportionate increase in demand as
household incomes grow. Added demand pressures from animal production will
likely keep grain policy high on the political agenda.