Grain-selling farmers, take note: National Food Administration issues urgent notice banning IOUs

As the summer grain purchasing peak season is currently underway, the National Food Administration recently issued an urgent notice requiring strict oversight and serious investigation and punishment of the practice of giving IOUs to grain-selling farmers.

The National Food Administration stated that since the second half of 2014, a few grain trading enterprises have violated national grain purchasing policy during grain purchases by giving IOUs to grain-selling farmers, seriously harming farmers' interests and affecting the implementation of the central government's pro-farmer policies.

In response, the National Food Administration required that all types of grain trading enterprises fully and faithfully implement the grain purchasing policy of settling payments with grain-selling farmers in cash and not issuing IOUs. They must immediately carry out self-examination and self-correction regarding their payment of grain payments; if any farmers' grain payments are owed, they must immediately be settled in full.

⟦NL> The notice made clear that the entities implementing national policy-based grain purchases must earnestly shoulder the primary responsibility of not giving IOUs to grain-selling farmers. Relevant central grain enterprises must further raise their awareness of the importance of implementing national grain purchasing policy, urge directly affiliated enterprises and their leased warehouse grain storage points and entrusted collection and storage warehouse points to strictly implement the national grain purchasing policy, strictly standardize the workflow of grain purchasing and fund settlement, and prevent any form of IOU problem from occurring.

The National Food Administration also required that grain administrative departments at all levels immediately join with the Agricultural Development Bank, Sinograin Company and other departments and units to organize capable forces and conduct comprehensive centralized screening of the payment of grain payments by all types of grain enterprises within their jurisdictions. Where farmers' grain payments are in arrears or IOUs are given to grain-selling farmers, each case discovered must be seriously investigated and punished, with no tolerance whatsoever.

At the same time, it required strict constraints on grain-purchasing enterprises and grain brokers to ensure they truly practice "one hand for grain, one hand for money, cash settlement", and strictly control purchasing enterprises and grain brokers to prevent embezzlement of purchasing funds, "high-interest" fraudulent use of farmers' grain payments and other violations and illegal acts.