The price of grain in China has become the highland of the world: the purchase of supporting the market at a high price can only be piled in a warehouse.

China is not the most developed country in the world, but the price of Chinese grain has been higher than that of the international market for several years. The large-scale collection and storage of grain and oil has made China's grain prices continue to rise, and the China National Grain Reserve Management Corporation, which is responsible for the collection and storage of grain and oil, has maintained a relatively high rate of return, while other grain processing enterprises that bear the risk of market competition are complaining.

The latest Social responsibility report from 2012 to 2013 released by China National Grain Reserve reveals that China's major grain varieties, such as wheat and rice, have maintained a steady upward trend in recent years.

Judging from the price trend of Sino-American wheat from 2005 to 2013, the price of American wheat market was about 1000 yuan / ton higher than that of China's market from 2007 to 2008. American wheat soared to about 2800 yuan / ton in 2008 and then fell sharply. For several years, the price of white wheat in China fluctuated around 1500 yuan per ton, and the price of white wheat in China has always maintained a steady upward trend. At the end of 2013, wheat rose to about 2500 yuan per ton in China and 1300 yuan per ton in the United States. the difference in wheat prices between China and the United States was about 1200 yuan per ton.

In terms of corn, the corn price curve of China and the United States intersected twice in 2008, with a price of about 1600 yuan / ton; but then, the price of corn in the United States began to fall, falling to about 900yuan / ton in mid-2009. While Chinese corn prices have maintained a steady upward trend since 2005, climbing to about 2250 yuan / ton at the end of 2013, the price difference between the two countries is about 1250 yuan / ton.

The influence of rice produced by the United States in the international market is limited, so Vietnamese rice is compared. From the comparison of market prices between China and Vietnam from 2005 to 2013, from 2005 to 2008, the price trends of China and Vietnam were similar, and the FOB price of rice (equivalent to rice) in Vietnam was slightly lower than that in China. From 2008 to 2009, after Vietnamese rice climbed to a high of about 5000 yuan / ton, it plunged sharply. By the end of 2013, Chinese rice was about 2900 yuan / ton, while the FOB price of 5% rice in Vietnam was about 1900 yuan / ton. The price difference between the two countries reached about 1000 yuan / ton.

China Grain Reserve said: "since 2005, strong reserve huff and puff regulation has been implemented through the vertical system of grain storage, thus maintaining the overall grain situation and the stable operation of the macro-economy. In sharp contrast to the ups and downs and frequent fluctuations of international grain prices in recent years, the market prices of major domestic grain varieties have maintained a stable operation, and China has become a 'safety island' in the world food crisis. "

China's grain prices remain high and the cost of grain processing enterprises has increased year after year, thus greatly affecting the performance of grain processing enterprises. Since 2009, the word "rising price of raw materials" has repeatedly appeared in 600598.SH 's annual report. as one of the largest rice processing enterprises in China, Beidahuang rice industry lost 170 million yuan, 560 million yuan and 422 million yuan respectively from 2011 to 2013, except for a profit of 7.19 million yuan in 2009.

Besides rice processing, China Cereals and Oil Holdings (00606.HK) is also one of the best processing enterprises of soybean, corn and wheat in China. The rising grain prices in China have also formed great pressure on its performance. In terms of return on net assets, China Grain and Oil Holdings has shown an overall downward trend since 2009, with returns on net assets of 11.11%, 6.06%, 13.16%, 4.63% and 5.41%, respectively.

The price of grain not only affects the efficiency of rice, noodle and oil processing enterprises. Corn is one of the main components of feed, and the rising price of corn has pushed up the cost of feed companies, but the weak end consumption of meat has made feed companies feel like a year. An executive of a large domestic feed company said: "from what we know about agriculture, due to state guaranteed acquisitions and subsidies, farmers are still profitable in grain production, but farmers engaged in aquaculture have been losing money for a year and a half due to the economic downturn." demand fell. "

Faced with complete market competition, grain processing and feed production enterprises have meagre profits or even losses, and the rate of return of stored grain purchased by the market is relatively more stable. From 2009 to 2013, the net asset income rate of China Grain Reserve was 9.66%, 10.24%, 10.5%, 9.26% and 6.34%, respectively. Except that it was lower than that of China Cereals and Oil Holdings in 2009 and 2011, China Grain Reserve remained in the lead in the other three years.

In 2013, China Grain Reserve completed a total of 88.1 million tons of policy grain purchases in 2013, reaching an all-time high, accounting for 32.6% of the country's total grain purchases in 2013. all kinds of policy grain managed by the company account for more than half of the total inventory of grain enterprises in the country. The operating income of China Grain Reserve reached 189.3 billion yuan in 2013, with total assets exceeding 500 billion yuan.

In the field of collection and storage, China Grain Storage is the largest, second to none. Grain and oil processing enterprises complain about this, and the local state-owned grain system is even more aggrieved.

Last year, China stored Grain purchased nearly 90 million tons of grain, but sold only 36.36 million tons of policy grain through the wholesale market. A large number of grain purchased in support of the market, due to the high price, grain processing enterprises lack of interest, can only be stacked in the warehouse, the storage capacity of grain is tight. When visiting the central grain reserve warehouse in Zhuzhou a few days ago, Premier Li Keqiang proposed that stored grain should be bought, stored and sold.

A number of industry insiders contacted by China Business Daily believe that China's large-scale grain collection and storage mechanism needs to be reformed and a new balance should be found between market-oriented operation and administrative intervention.