MySheen

Food Security: opening up and self-improvement

Published: 2024-11-22 Author: mysheen
Last Updated: 2024/11/22, From the point of view of a trading enterprise, a country's agricultural policy and the form of global agricultural trade should influence each other. In the context of globalization, agricultural policies can affect trade policies and global trade flows. The success of China's agricultural policy

From the perspective of a trading enterprise, a country's agricultural policy and the global agricultural trade pattern should be said to interact. In the context of globalization, agricultural policies can influence trade policies and affect global trade flows.

china's agricultural policies have achieved remarkable results

China's agricultural trade has developed very rapidly in the past six or seven years. Soybean imports have increased stepwise, from 50 million to 60 million, to 70 million tons in 2015 and possibly to 80 million tons next year. Driven by consumption growth and urbanization, the dietary structure has changed from eating grain to eating meat, eggs and milk in the past, which directly drives the development of feed industry and the import of feed raw materials. With 80% of soybeans as feed ingredients, you can see market-driven imports growing. At the same time, other feed raw materials are also growing, and grain imports are also growing, driven by economic development.

Corn imports are relatively stable, basically about two or three million tons per year, the scale is not very large, but the feed other than corn shows rapid growth. The first reason why China's corn imports are difficult to increase is because there is a price difference. Trade is price chasing. Barley, distiller's grain protein feed (DDGS), sorghum, the first two years of imports are relatively large, in the final analysis, there are market reasons. Second, it is more a result of agricultural policy. China's agricultural policies have achieved very good results in the past decade or so, agricultural output has been continuously increasing, and domestic stocks are very sufficient. From the overall situation, food is sufficient and farmers increase their income. From another point of view, it has also affected the agricultural production of other countries to a certain extent and affected China's imports. From this perspective, it should be said that trade is largely influenced by agricultural policies. It is interesting to see the impact of globalization from this perspective.

Combination of production and consumption

Now the prices of agricultural products in China have begun to adjust. How can we have a better price that can stimulate consumption and stimulate domestic consumption while increasing production and income? The agri-processing industry has probably had its worst year in history in the past two or three years, with some corn mills already out of production this year. At this time, the state adjusted its agricultural policy in a timely manner. I think it was a scientific adjustment from the overall perspective. Although the import business will be affected to some extent, the entire domestic market is alive.

In the past, the policy orientation was to "encourage production and increase farmers 'income"; today's orientation is "from the field to the dining table"; today, the decisive role is the consumption of the urban population, the entire cost of living, whether they can live well and live safely. This is the main direction of policy. Agricultural policy at the present stage needs to balance the relationship between production and consumption.

From the agricultural point of view, there is a big worry at this stage is the slowdown in exports. First, because domestic agricultural production has decreased, fragile land has to be withdrawn from cultivation, resulting in reduced yields. Second, domestic grain stocks are relatively high and we need to digest them. In the short term, imports due to price factors will also slow down. But in the long run, import trends are irreversible. From the national point of view, food security policy will not change, should be appropriately imported, especially feed, grain moderate import, oil completely liberalized. Judging from the trend of domestic consumption growth, the per capita consumption level of meat, eggs and milk is still very different from that of the United States, Europe, Australia and other regions. This growth is still rigid. Therefore, from these perspectives, it may take two or three years to digest domestic stocks in the future.

Integration of environment and agriculture

It is hoped that the state will issue policies on the industrial use of agricultural products as soon as possible. At present, our corn enters the production link of fuel ethanol, which is a direct pull for domestic consumers and will not affect the entire traditional food field. Whether it is corn processing, rapeseed processing, or the use of biodiesel, bioenergy, etc. in the field of industrial ethanol, it can greatly increase short-term consumption, and contribute to long-term environmental improvement and long-term pull of agricultural product production. In fact, foreign precedents in this regard have also given us a good reference. A point at which industry and agriculture are well integrated is the dramatic increase in maize production following the heavy use of ethanol in some countries, stimulating domestic consumption. This is both a short-term arrangement and a long-term consideration because it integrates environment and agriculture.

Combination of reform and opening up

APCE, G20 and FTA are all good mechanisms for multilateral, bilateral and regional consultations on agricultural trade and investment, especially the "Belt and Road" policy proposed by the Chinese central government, which provides a very good opportunity for China and neighboring countries to carry out agricultural consultations and facilitate agricultural trade, including agricultural enterprises going global.

First of all, with the opening of the market for agricultural products, agricultural trade will become more and more convenient and tariffs will be reduced. China's abundant grain stocks provide us with favorable conditions for opening up agricultural trade and a good direction for agricultural price reform. Often a reform, will worry about farmers 'output reduction, supply instability. Today we have abundant stocks, which will bring a good opportunity for agricultural trade negotiations on the entire international market. Especially in the long run, after the marketization of prices, China's imports will be guided to a benign track. From this perspective, we are still very happy to see this price change. In the past two or three years, COFCO has been "going out", investing overseas and building supply chains. As an agribusiness, we definitely have to go abroad to develop our supply chain, because we will be a global enterprise in the future.

Second, in the process of multilateral and bilateral negotiations, more consideration should be given to how the investment environment will be when Chinese enterprises go out. At present, China still has some special approvals for "going out" of state-owned enterprises. Of course, there is no outstanding problem in approval now, but compared with competitors in other countries, there are still some extra links, which is an unfair situation.

recommendations

Based on the above observations, I have four suggestions.

First, in improving agricultural policies, we should still be firm in our attitude and direction of reform. Only in this way can China's agricultural enterprises become more and more competitive and stronger. With the reform, the scale of China's agricultural enterprises will continue to expand, agricultural organizations will continue to strengthen, and agricultural enterprises will become stronger and more competitive. Along with the changes, the state may have a comprehensive plan for the layout of agricultural production. Especially in the aspect of agricultural subsidies, after directly subsidizing farmers, the amount of farmers 'income, what farmers produce and how farmers' income is composed need to be improved as soon as possible. In addition, attention should also be paid to the domestic industrial layout, including the health of the industry. It cannot be said that farmers are happy and processing enterprises are very uncomfortable. This is not a policy orientation.

Second, increase the transparency of agricultural production, supply and marketing. With the development of APCE, WTO and TPP, information transmission in domestic and foreign markets is very important. China has ample stocks. The Chinese government's annual transparency on the production, supply and marketing of major agricultural products will enable global agricultural production planning to have a good forecast. Global resources would also be better used. At the same time, the government should have a very clear and definite grain reserve plan. In this way, after the market is truly liberalized, there will be an automatic optimization adjustment.

Third, after COFCO "goes global", the degree of internationalization has increased significantly, and international peers no longer regard COFCO as a domestic enterprise. It is hoped that the government can also promote the construction of commercial self-regulatory institutions in the industry and accelerate its integration with the international community. COFCO is very willing to play an active role in this regard.

Fourth, in promoting multilateral negotiations, the government hopes to consider issues from the perspective of improving the international investment environment to promote Chinese enterprises to "go global".

 
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