Policy evaluation of China’s agricultural market

HU Bingchuan1

(1.Rural Development Institute of Chinese Academy of Social Sciences)
【Knowledge Link】emerging market

【Abstract】In recent years, prices of China’s agricultural products on the whole are maintained at a relatively high level; and in the market operation of agricultural products (especially bulk farm-products like grain and cotton), there are contradictory phenomena emerging, for example, high yield, high consumption, high import and high inventory are contradictory. At the same time, China’s agricultural policies are faced with problems such as price “floor” and price “ceiling” problems out of production cost increase. To this end, this paper firstly combs market the operational conditions of both the global and China’s agricultural markets in recent years briefly, and focuses on analysis and assessment of China’s major policies in the agricultural market on this basis. This paper thinks that the implied condition for China’s policy logic of agricultural market is the overall level elevation of the price of agricultural products. While under the context of global economic downturn and long-term price plummet of agricultural product price, China’s overall policy system of agricultural market will be faced with great impacts, such as, price inversion, subsidy “yellow line,” and agricultural products smuggling. Finally, for the long-term development of China’s agricultural production, this paper thinks that the focus of policies should be to guarantee agricultural production ability and improve agricultural productivity. There is no sense to simply pursue the growth of output quantity. Therefore, in the future, China should establish an agricultural safety network which, as a stereoscopic agricultural policy system, can achieve agricultural risk sharing and independent production decision, and comprehensively use policy instruments such as supervision, negotiation, subsidy, insurance and credit.

【Keywords】 agricultural market; coupled subsidy; production efficiency; agricultural safety network;

【DOI】

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(Translated by TANG Weiqing)

    Footnote

    [1]. International Monetary Fund (IMF):World Economic Outlook (WEO), website of IMF (http://www.imf.org). [^Back]

    [2]. FAO:Food Outlook, FAO website (http://www.fao.org). [^Back]

    [3]. FAO (http://faostat3.fao.org). [^Back]

    [4]. Data source: Statistical Bulletin of National Economy and Social Development in 2014 of National Statistics Bureau, website of National Statistics Bureau (http:.www.stats.gov.cn), Feb. 26, 2015. [^Back]

    [5]. Li, Y., Li X. & Zhang Ping (eds): Economy of China Analysis and Forecast (2015). Beijing: Social Sciences Academy Press, (2014). [^Back]

    [6]. Data source: Statistical Bulletin of National Economy and Social Development in 2014 of National Statistics Bureau, website of National Statistics Bureau (http:.www.stats.gov.cn), Feb. 26, 2015. [^Back]

    [7]. Rural Development Institute of Chinese Academy of Social Sciences, Rural Economy and Society Research Office of the National Bureau of Statistics: China’s Rural Economic Situation in 2013 and Outlook in 2014. Beijing: Social Sciences Academy Press, (2014). [^Back]

    [8]. Details can be seen in the information website of customs (http://www.haiguan.info). [^Back]

    [9]. China Grain Network (http://www.cngrain.com). [^Back]

    [10]. Data in the Grain Production-Demand Balance Form is calendar-year data. [^Back]

    [11]. Data in the Wheat Production-Demand Balance Form is calendar-year data. [^Back]

    [12]. Details can be seen in the Ministry of Agriculture (http://moa.gov.cn). [^Back]

    [13]. Data in the Corn Production-Demand Balance Form is annual data of maize crop, similarly hereinafter. [^Back]

    [14]. China’s National Grain and Oil Information Center (CNGOIC): Monthly Report of Supply and Demand Conditions of Grease Oil Market, No. 182, Mar. 3, 2015. [^Back]

    [15]. Data source: Analytical Prediction and Investment Strategy Consultation Report of China’s Soft Sugar Market from 2014 to 2019, China’s Industrial Information website (http://www. chyxx.com). [^Back]

    [16]. Data source: United States Department of Agriculture website (http:/apps.fas.usda.gov/psdonline). [^Back]

    [17]. Data source: Cotton China website (http://www.cottonchina.org). [^Back]

    [18]. Price Department of the National Development and Reform Commission (eds.): Data Compilation of Cost-Benefit of National Agricultural Products of 2014.Beijing: China Statistics Press, (2014). [^Back]

    [19]. Cotton China website (http://www.cottonchina.org). [^Back]

    [20]. Employment number per mu of cotton is bigger, but here we might as calculate it simply. [^Back]

    [21]. Due to factors like basic land system, quality of agricultural producers etc., theoretically, the input and output of China’s agricultural production cannot be in effective production frontiers. The most crucial factor leading to this problem is unreasonable allocation of agricultural production resources, namely, low production efficiency caused by resource misallocation. [^Back]

    [22]. Coupled subsidy for any variety of agricultural products is a discrimination against other agricultural production. [^Back]

    [23]. Such as black soil deterioration in Heilongjiang Province. [^Back]

This Article

ISSN:1002-8870

CN: 11-1262/F

Vol , No. 04, Pages 4-13

April 2015

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Article Outline

Knowledge

Abstract

  • 1 Overview of the global agricultural products market
  • 2 Overview of China’s agricultural market
  • 3 Agricultural market and price
  • 4 Evaluation of major policies for agricultural market
  • 5 Trend judgment and policy thinking of 2015
  • 6 Conclusion
  • Footnote