Wednesday, May 8, 2013

State Council: Agriculture Worries

A May 8 meeting of the State Council on agricultural problems was chaired by Premier Li Keqiang and featured at the top of the page on the Peoples Daily. The article was also posted on Central China TV and read out word by word.

While the article insisted that agriculture is overall stable and this year's wheat and early-season rice crops are doing well, it warns that "agriculture faces major difficulties":

  • The northeast has had serious spring flooding
  • Drought in the northwest and southwest regions still has not eased
  • Hog prices are falling
  • Supplies of beef and mutton are tight
  • H7N9 avian influenza are causing serious losses in the poultry industry
  • The April earthquake in Lushan, Sichuan Province seriously affected agriculture in that region
In light of these problems, warns the article, it is critical to take precautionary measures to prevent inflation, maintain balance between supply and demand of agricultural commodities, and keep farmers' income growing. 

The article--apparently written for local officials--called for keeping a tight grip on production of grain, pork, poultry, doing a good job on spring cultivation and planting, guiding production of early-season rice and wheat, guaranteeing seed supplies in the northeast, and carrying out various measures to mechanize production. It calls for support of large farms and family farms as the foundation of modern agriculture. 

The article included shout-outs to beleaguered sectors. It called for a "reasonable" increase in the support price for corn as an encouragement to producers now facing low prices and weak demand. 

The article addressed low pig prices, calling for expansion of government and private pork reserves and stabilization of pork prices. It obliquely addressed the dead pigs in the river incident by calling for support for "above scale" hog farms (the dead pigs came from relatively small household operations) and establishing a dead animal disposal system. 

High beef and mutton prices are to be addressed by promoting "standardized" beef and sheep farming, fully utilizing the improved breed subsidy program, and giving financial support to major production counties. 

Officials are ordered to do a good job on prevention work against H7N9. The article calls for maintaining poultry breeding capacity--reflecting a concern that the kill-off of poultry will result in a short supply that will lead to soaring prices later in the year when the fear of eating poultry has faded away. Poultry enterprises are to get short-term subsidized loans for working capital to keep them afloat.

Consumer food safety fears are addressed by calling for a crackdown on sale of fake and adulterated livestock products. Inflation worries are reflected in a call for food subsidies for low-income people to protect them against the effects of rising food prices. 

Provincial governors are reminded of their "rice bag" responsibility system for ensuring that provincial grain supply and demand are in balance, and mayors are reminded of their "vegetable basket" responsibility system which demands that local authorities ensure supplies of vegetables, meat and fish. Officials are urged to keep up the pace of reform and innovate in their thinking on agriculture, perhaps a sign of a new approach to agricultural policy is on the horizon.

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