Does the price of rice go down, can processing enterprises take advantage of it?

Rice is one of the most important staple grains in China. Due to frequent extreme weather this year, the main rice producing areas in China, such as Hubei, Anhui, Jiangxi and Hunan, have encountered disasters to varying degrees. At present, the late rice is still being harvested, but there is frequent news that both the yield and price of rice are declining in many major rice producing areas in China.

Although the price of rice is not ideal, throughout the industry, it has always been a pattern of strong and weak rice, that is, compared with the price of rice, the price of rice is weaker, and it is difficult for many grain processing enterprises to survive. So with the decline in rice prices this year, have processing enterprises got the opportunity? According to this year's situation, how should farmers sell grain?

On the edge of a rice field in Yangwei Town, Gao'an City, Jiangxi Province, the reporter saw the gold paddy field, a major grain grower who contracted for this land. Having worked in Guangdong for more than ten years, he returned home with all his savings the year before last and contracted 1500 mu of land to grow rice. Last year, the rice yield was high and the price was good, but this year the yield was not good.

Golden paddy field: early rice, middle rice and late rice added up to an average yield of thousands of jin per mu last year. The yield per mu is about 900 jin this year.

Jin Paddy said that the reduction in production this year is mainly due to the weather. Since late July, the local high temperature has persisted. From July 21 to August 31, the average precipitation in Jiangxi Province was 123 mm, a decrease of 33% compared with the same period in previous years. This period happens to be a critical period for the growth of rice. The yield and quality of rice are affected, and the price is also much cheaper.

Golden Paddy Field: the processing plant is purchased at 133 yuan per 100 jin, which is 20 yuan less than last year.

Li Guoxiang, a researcher at the Institute of Rural Development of the Chinese Academy of Social Sciences, said that although some major producing areas have also reduced production to varying degrees. However, in recent years, the planting area of rice in China is relatively stable, the output is still growing slowly, and the market supply exceeds demand, so the price is falling.

Li Guoxiang: at present, the annual output of rice reaches 200 million tons, so our entire consumption is far less than 200 million tons in terms of the caliber of food rations. In this case, there is a loose supply and demand of rice.

In the former rice industry in Gaoanrui, Jiangxi Province, quality inspectors used a special instrument to insert a bag to test the quality of the rice. Hu Huailin, a local grain broker, said that the quality of the rice was not good this year and the purchase price had been going down.

Hu Huailin: the price is 10 yuan lower than that of last year. If you sell it to a rice factory, it should be reduced by 5 or 6 yuan per jin.

As we all know, China's rice industry has always been a pattern of strong rice and weak rice. Last year, grain processing enterprises bought medium rice at a price of about 138 yuan, but this year the price fell to 132 yuan, equivalent to a reduction of 6 or 7 cents per jin of rice. this is good news for enterprises that usually make profits of less than 3 cents per jin of rice. As a result, companies feel that they will increase loans and buy rice this year. Xu Guiping, General Manager of Ruiqian Rice Industry, Gao'an City, Jiangxi Province:

Xu Guiping: the loan should be at least 10 or 20 million.

However, the enterprises that expand the production scale are still a minority. Due to the meagre profits of rice processing in recent years, the business is very difficult. In the past two years, many rice processing enterprises are actually gradually leaving the industry. Sun Guangmei, Agricultural products analyst of Zhuochuang Information:

Sun Guangmei: the operating rate of rice enterprises across the country has been maintained at about 30% in recent months, which is a very low figure.

If the operating rate of processing enterprises is low and their acquisitions are not active, where will the grain in the hands of farmers go? In addition to selling to grain processing enterprises, another important export of rice is to sell to national grain depots. In order to stabilize grain prices and protect the interests of grain farmers, the state established a minimum purchase price policy in 2004. The reporter learned that due to the shortage of national storage capacity, many food farmers did not sell grain smoothly. In the grain depot of the Grain Management Bureau of Yangwei Town, Gao'an City, the last batch of rice purchased this year is preparing for storage. Although the original grain harvest plan lasted for more than two months, the purchase of the grain depot had to be stopped after two days of grain collection because of the tight storage capacity. Luo Wenzhong, Director of the Bureau of Grain Administration:

Luo Wenzhong: because there is only a capacity of more than 6 million kilograms this year, so far there is still grain for 2013.

In the end, only 1/3 of the 500 mu of early rice planted by rice farmer Jin paddy field was sold to grain depots, half of the remaining grain was sold to grain traders, and half of the remaining grain had to be saved on its own.

Golden Paddy Field: the key problem is not so much grain warehousing, the policy is very good, but there is no way to store enough.

It is understood that local grain depots are also trying to increase storage capacity, but the current grain rotation and auction is not satisfactory. The cost of storing a warehouse or renting a warehouse from a processing enterprise is too high. Xiong Guohua, Manager of Grain and Oil Purchasing and Marketing Company, Gao'an City, Jiangxi Province:

Xiong Zihua: if the guarantee company of small and medium-sized enterprises is required to guarantee it, he has to charge a guarantee fee of 20%, so according to this calculation, it costs 70 yuan per ton. If it is based on the storage fee of 94 yuan per ton, a large part of it will be given to the guarantee company. Among them, private enterprises also need 30-50 guarantee fees and 20-30 safekeeping fees.

Li Guoxiang said that not only Jiangxi, but also many major grain producing areas have the problem of tight warehouse capacity. The hidden grain does not circulate smoothly, which needs to be paid attention to.

Li Guoxiang: we must maintain a proper relationship between grain storage and consumption. If we overstore it, there will be problems sooner or later. Therefore, on the one hand, we should continue to expand the warehouse capacity and build the warehouse well, especially in both aspects, especially in the new situation, we should ensure the absolute safety of food rations. Another aspect is to ensure our grain production, especially for early indica rice to strengthen the adjustment of grain structure.

According to the data of the China Grain Industry Association, the national rice processing enterprises have a production capacity of nearly 300 million tons, with an actual processing capacity of less than 1/3, and serious overcapacity. In fact, there are many small rice processing plants that are not listed in registration and statistics, which makes the phenomenon of strong rice and weak rice exist for a long time. As the capacity utilization rate of rice processing enterprises is lower than that of wheat and soybean oil enterprises, we also look forward to the integration of resources, transformation and upgrading of the whole industry.