The state lowered the temporary storage price of corn and farmers shouted to compensate enterprises for losses.

Farmers cry out to compensate enterprises for losses.

The state lowered the temporary storage price of corn and blew a pool of water.

Our reporter Wang Peilian's China Youth Daily (06 edition, December 3, 2015)

Recently, Hua Shujun, a big corn grower in Gaojia Village, Songyuan City, Jilin Province, often went to the state storage near the village to inquire about the purchase price and storage situation of corn.

In addition to farming, Hua Shujun also runs a planting cooperative. This year, all the members of more than 60 households have planted corn. A few days ago, some members sold corn with a water content of about 26%, or 0.81 yuan per jin.

On November 1, the state officially launched the acquisition of temporary stored corn in three northeastern provinces and Inner Mongolia Autonomous region this year, one month earlier than in the same period in previous years. According to the regulations of the National Development and Reform Commission and other four ministries and commissions, the temporary storage price of corn this year is 1 yuan per jin, 0.12 yuan lower than last year. The purchase price has been cut for the first time since the corn temporary storage policy was implemented in 2008.

In the words of farmers, "Last year, dried corn with a moisture content of about 12 cents per jin could only be sold for one yuan at most this year."

In the northeast, the moisture content of the newly harvested corn is about 30%. "if you take out a few cents more for threshing and transportation, it will cost less than 80 cents per jin." Hua Shujun said. Unless he is in a hurry to use the money, most of the corn harvested by his members is still stored in his yard.

Although Hua Shujun knew that the national temporary storage price would not change from time to time, he summoned members to discuss it together and waited for more than 20 days. They calculated that if the state treasury did not harvest enough grain this year, corn with 26% water content might be sold for a price of 24% water content over a period of time, making a few more cents.

What they do not know is that the pressure of corn storage in the three eastern provinces is huge. In Jilin Province alone, the inventory of corn in the national warehouse has been more than three times higher than normal.

However, the huge inventory has not brought good news to the corn processing enterprises. Corn purchase prices, which have been rising in previous years, make it difficult for corn processing enterprises to bear high production costs, or lose money or stop production or close down. In the view of a number of people in charge of corn deep processing enterprises, the corn storage price has been reduced by 0.12 yuan per jin, which is a drop in the bucket for enterprises.

Farmers cry for compensation, enterprises call losses, what happened to the price of corn?

"if you don't expect to grow corn, you will lose it."

The most important thing is to have national policy support for high yield per unit area, drought and waterlogging, which is the reason why Hua Shujun and his cooperative farmers choose to grow corn.

In recent years, farmers have indeed benefited from this. From 2008, Jilin region corn temporary storage purchase price 0.75 yuan / jin, the highest rose to 1.12 yuan / jin last year. The rise in the purchase price of corn was followed by the cost of farming for farmers. In various areas of Jilin Province, land rents have risen year after year. A few years ago, the rent of the best land in Gaojia Village, Songyuan City was 7000 yuan per hectare. This year, the rent has reached more than 10,000 yuan per hectare.

This year, Huashu Army planted 14 grains (140 mu) of corn. The rent per hectare is 8500 yuan, plus the consumption of seeds, fertilizers and pesticides, the cost per hectare is about 12000 yuan. Hua Shujun said that this does not include labor costs.

Unfortunately, July this year coincides with the heading period of corn, and many parts of Jilin Province have experienced drought. The yield of Hua Shujun's corn fields has been reduced by nearly half. Normally, each grain can harvest more than 20,000 jin, but this year it is only more than 10,000 jin. Coupled with the reduction in the temporary storage price of corn, Hua Shujun not only did not make any money this year, but also lost more than NT $1500 per cropland. "it is unthinkable that planting corn will lose money, and the more you plant, the more you will lose."

In Jilin, like Hua Shujun, there are not a few farmers who lose money by renting land and growing corn.

While the temporary storage price is reduced, the state has raised the quality standard for the purchase of corn. In previous years, the mildew rate was less than 5%, but this year it should be controlled within 2%.

Knowing that the temporary storage corn had raised the acquisition standard, Zhang Yanhua of Dongxing Village, Changling County, Songyuan City, sold the corn a week after receiving it. She feels that if we continue to wait, the price will not go up, and the mildew rate may increase at home. "if we can't get into the treasury, we will lose even more."

Cui Lei, supervisor of Huaguan planting Professional Cooperative in Nongan County, Changchun, told China Youth Daily that nearly 30,000 corn growers in the cooperative have sold corn so far. Knowing that the standard of corn entering the country's storage has improved, the general practice adopted by farmers is to turn over the corn with sticks stored in the yard one by one and remove the moldy particles. "it is estimated that in this way, the mildew rate should be controlled within 2%."

Despite the continuous promotion of scientific grain storage in Jilin Province in recent years, there are still many farmers who pile up corn directly on the soil after harvest. According to the statistics of the Jilin Provincial Grain Bureau, the average loss rate of corn stored grain by farmers in the province is about 11.8%.

What about corn with mildew rates between 2% and 5%? The state stipulates that local governments shall organize acquisitions in accordance with the requirements of the provincial governor responsibility system for food security and the local responsibility system for food safety. Wang Tao, director of the regulation and control department of Jilin Provincial Grain Bureau, told China Youth Daily that at present, the corn output of Jilin Province with mildew rate in this range is still in statistics, and how to purchase and deal with it has yet to be discussed.

"I don't know if there will be normal production next year."

Over the past seven years since the implementation of the temporary storage policy, although farmers have benefited, it has been difficult for corn processing enterprises.

The temporary storage policy led to the upside-down of the two corn markets. First, domestic and foreign corn prices hang upside down. Xiao Fei, general manager of a corn deep processing enterprise, said that when the domestic corn price difference is the highest, it is 1000 yuan / ton higher than the international corn price. As a result, the export of corn deep processing enterprises in Jilin Province has been restricted. In the past, a large number of deep-processed corn products of Xiao Fei's company were exported to Southeast Asia, Japan, South Korea and other countries and regions. "in the past three or four years, this part of export orders have been gone, and customers have been lost."

The second price is upside down, between the provinces that have implemented the corn temporary storage policy and those that have not implemented this policy. At present, the policy is only implemented in the three northeastern provinces and Inner Mongolia Autonomous region. "in the past, Jilin corn deep processing enterprises still had the advantage of producing raw materials, and one ton of corn could save 150 yuan to 200 yuan, which just made up for the cost of transporting products to the south of the main selling area." 'now that advantage is gone, 'Mr. Xiao said.

In previous years, during the corn harvest season, Xiao Fei had to rush to harvest a batch of corn that could not be stored in the national treasury, "but the quantity is far from enough." Due to the high price of temporary storage, most farmers pay attention to the quality of corn and strive to sell it to the national treasury. It is difficult for companies to buy corn on the market around March every year.

If you want to produce normally, you must go to the state warehouse to auction the temporary stored corn. Last year, the state treasury purchase price was 2240 yuan / ton, to the enterprise at least 2400 yuan / ton, Xiao Fei's enterprise can not afford such a high cost.

Corn deep processing enterprises in the three northeastern provinces which no longer have the price advantage of raw materials are very difficult to compete with similar enterprises in foreign countries and even other provinces in China.

From the middle of August to the end of September this year, the plight of corn processing enterprises in Jilin Province reached its peak. There are a total of 22 corn processing enterprises in the province, most of which have stopped production, and some have gone bankrupt or closed down.

As a result, Jilin Province subsidized corn processing enterprises in the fourth quarter, with a subsidy of 250 yuan for every ton of corn purchased.

With subsidies, Xiao Fei bought a batch of new corn locally at a price of 1850 yuan / ton, ensuring that the company produced at full capacity in the fourth quarter, "at least not at a loss."

According to Wang Tao, corn deep processing enterprises in Jilin Province have a total annual production capacity of more than 15 million tons. After the subsidy, 14 enterprises continued to maintain production, starch products slightly loss, alcohol products slightly profitable.

Xiao Fei calculated that if the enterprise wanted not to lose money, the price of corn would have to be less than 1600 yuan per ton. In the past, when corn prices were at their lowest in mid-November, Xiao Fei's company would store more than 100, 000 to 200000 tons of corn to guarantee usage for more than 20 days to a month.

"now no one dares to build inventory any more. They all use it whenever they buy it." Xiao Fei said that at present, the domestic corn market is changing so fast that many long-term orders are afraid to sign. Their enterprise now has a production capacity of 750000 tons, and it is planned to double its production capacity in recent years. However, in the past three years, the cumulative loss of the enterprise has reached 200 million. The larger the temporary reserves of corn, the more losses the deep processing enterprises will lose.

It is not known whether Jilin Province will continue to subsidize corn processing enterprises next year.

How much is the price of corn?

According to the analysis of a number of industry experts, the state has continuously raised the corn temporary storage purchase price, which has aroused the enthusiasm of farmers in planting and ensured the national food security, but has affected the supply and demand of corn in the domestic market. As a result, domestic grain prices are significantly higher than those in the international market, corn stocks in the main producing areas remain high, and the financial burden is increasing day by day.

In the view of Shu Kunliang, deputy director of the Northeast Regional Agricultural Development Research Center, the high inventory in the main producing areas is a structural surplus. The upstream temporary storage policy leads to market distortion, inventory can not be eliminated, and the demand for downstream industrial and feed corn can not be met.

"at present, under the premise that the country is unable to sell corn in temporary storage at a reasonable price, it has to be adjusted from the supply side, that is, to reduce the planting area of corn." Shu Kunliang said.

How to effectively reduce the planting area of corn? Shu Kunliang believes that a lot of research and calculations are needed, not only the price of corn, but also other competing crops, such as soybeans, to allow farmers to voluntarily reduce their corn acreage.

Jilin Province is not only the gold planting belt of corn, but also the gold planting belt of soybeans. Shu Kunliang said that in recent years, high-yield corn has replaced low-yield and rotation soybeans, and soybean acreage has shrunk sharply.

In 2012, corn overtook rice to become the largest food crop in the country, according to data released by the National Bureau of Statistics. In 2014, the country's total grain output reached 607.09 million tons, of which corn output was 215.67 million tons.

At present, no one can tell how much the domestic corn price is appropriate. A number of experts pointed out that corn is a quasi-public product and cannot be fully marketized. What is being studied and discussed is the target price of corn, that is, taking into account the prices of corn market and other competitive crops and state subsidies.

Shu Kunliang said that the state and the main corn producing areas can be a contractual relationship. He and his corn development research group suggested that the country should specify how much corn the main producing areas need to produce and sign orders with the main producing areas. The quantity of the order must match the target price of corn in order to ensure that farmers can produce the order quantity of corn. Precise regulation and production should be the trend of maize planting in the future.

In the face of the reduction in corn temporary storage prices this year, Jilin Province has opened 901 temporary storage sites, and more than 200 will continue to be arranged. Wang Tao said that opening up more temporary storage sites can not only help farmers reduce transportation costs, but also form healthy competition among grain depots, present a seller's market, and help farmers sell grain.

In addition, through television publicity and guidance, the Jilin Provincial Grain Bureau has also let farmers know that "1 yuan per jin" is already the highest collection and storage price this year, hoping to reduce farmers' wait-and-see and cherish sales.

What should be planted next year? Cui Lei, who has been growing corn for six years, said that in addition to his own 3 plots of land, he will not cover any additional land to grow corn. The Nong'an Huaguan planting Cooperative, where he belongs, also plans to encourage its members to reduce the planting area of corn and support projects such as vegetables, melons and fruits in the greenhouse.

Hua Shujun, who has been growing corn for more than a decade, estimates that land rental prices should fall next year. He will also grow corn in a large area. "We are the best place to grow corn."