Dim Sums: Agricultural Markets in China

As reported earlier this week, China's Ministry of Agriculture is sending teams of officials out to villages this month to conduct surveys. Today the Ministry reports on Minister Han Changfu's survey of a village in Guizhou Province during February 24-27. The article explains that the Ministry has a strategy of matching up each departmental official with a village, farmer cooperative or agricultural company. The official is supposed to form a long-term relationship with his counterpart so that he/she will fully understand the rural situation. While this is an admirable strategy, Han's visit is clearly a scripted propaganda exercise intended to boost the spirits of disgruntled villagers and prod local officials to implement agricultural policies. Minister Han's village is Songshan village in Guizhou's Weining County. Han visited Songshan on his survey. As soon as he got out of the car, he walked into the fields where villagers were working and began chatting ab...

A corn inspection tour by the China Grain Net reports that this year's corn harvest in Shandong and Hebei Provinces is afflicted with high rates of mold growth due to wet weather. (Mold releases mycotoxins that can cause digestive problems in livestock consuming feed that contains moldy grain.) Due to the high incidence of mold in the region, feed companies in Shandong and Hebei are being cautious about buying local corn. The survey team says about 50% of this year's corn has been sold by farmers in Binzhou and Liaocheng of Shandong and less than 20% in Handan, Hebei Province. Feed mills are instead buying corn from the northeastern provinces where the corn is drier. This means demand for northeastern corn is unusually high, pushing prices up there while prices in Shandong-Hebei are weak. Thus, the usual price relationship is inverted--prices in the northeast are higher than in Shandong-Hebei. The survey team visited a number of feed mills and industrial processors of co...

The Ministry of Agriculture is organizing survey teams of officials who will fan out into villages to drum up enthusiasm among farmers for planting crops, give them guidance, find out about new problems, trends and innovations and report back about farmers' concerns and requests. The survey team campaign is not new (there was a similar campaign last year) but the motivation seems to reflect persistent worries that grain production is not keeping up with demand. Officials want to boost production to head off rises in grain prices. Another motivation seems to be an urgency to head off rural unrest by disseminating propaganda about government policies and gathering intelligence on what's happening in the countryside. According to the Ministry of Agriculture's web site , the "hundred township, 10,000-farmer survey team" ( 百乡万户调查组 ) campaign will organized 123 officials and technicians into 30 teams that will spend a month visiting farmers in their homes in 27 provin...

A researcher from China's National Weather Center warns that low precipitation this spring could affect crop production in some parts of China. Yunnan school children collect drinking water in drought-affected area.   The most serious drought situation is in parts of Yunnan and Sichuan provinces in southwest China. There has been serious drought in this area for three years and dry conditions persist this year. Many reservoirs in the region are dry. According to a news report , 3 million people and 1.6 million livestock in the region are affected to varying degrees by lack of drinking water. Nationwide precipitation is expected to be low during March-May. Concerns about drought conditions are focused on regions in northeastern China (Inner Mongolia is singled out), north China (the Huang-Huai River region, including Hebei Province), and the Yangtze-Han-River plain (central Hubei Province). The dry conditions come at a critical growing period for the winter wheat crop and...

An article from Securities Times  voices the growing worries in China about food security. Despite record increases in grain production, the article worries about the growing "imbalance" between supply and demand. The article notes that China is heavily dependent on imports of soybeans and foreign trade in corn, wheat, and rice is shifting from net export to net import status. The writer worries that grain is becoming another commodity that China has to import, following petroleum, steel, and minerals. Food security is an overriding policy objective in China. The article quotes the chief economist of the Ministry of Agriculture who said that maintaining basic self-sufficiency in grains is the fundamental principle for developing modern agriculture. China's eighth-straight increase in grain production was confirmed by preliminary agricultural statistics in the 2011 national statistical communiqué  issued Feb 22 by the National Bureau of Statistics. Grain ...

The "hard to sell" (卖难) phenomenon has been a topic of discussion in Chinese agriculture since at least the 1980s. "Hard to sell" describes a mismatch between supply and demand or poor agricultural market infrastructure that leaves farmers unable to sell what they produce. The "hard to sell" phenomenon was the basic problem addressed by Xi Jinping's thesis and the problem has been serious enough recently that several paragraphs in this year's "Number 1 Document" were devoted to agricultural marketing improvements. A recent article posted on a "san nong" (agriculture, rural people and rural areas) web site provides a good analysis of the "hard to sell" problem . The article is written by Chu Guoliang, a faculty member at the communist party school of Xiangtan, a region of Hunan Province. Based on his observations in villages, Chu identifies three types of "hard to sell": When farmers overproduce by ...

Several days ago, the dimsums blog posted news about a scheme to mortgage land rights in Chongqing. Today's post  describes a critique of these land transfer and mortgage schemes by Chen Baifeng, a young professor at South Central University of Finance and Politics. The issues are fundamental to the social and economic system of rural China. Who owns the land in rural China? Who will farm and how will the profits be distributed? Can traditional village society adapt to commercial farming? The critique is aimed at another model region, Zaozhuang Municipality in southern Shandong Province. Zaozhuang has launched a number of innovative schemes in the last several years that include township land transfer systems, mortgage loans secured by property rights and land cooperatives. Delegations from rural areas all over China have come to inspect Zaozhuang's system and many have gone home to imitate it. Such schemes are widely used in Shandong. Chen notes that such schemes get a lot...