The 8 Core Connotations and 5 Key Focus Areas of Family Farm Development

A family farm is another new type of agricultural operating entity that has emerged after large specialized farming and breeding households, farmers' cooperative economic organizations, and leading agricultural enterprises. Developing family farms is the engine for further deepening the reform of rural institutional mechanisms. What a family farm is and how to develop family farms are currently hot topics of discussion.

After extensive research, we believe that a family farm is an operating entity in which a rural household, based on land and other resources it has contracted to manage itself, and expanded through legally transferred and stably obtained land and other resources, adopts intensive management methods and modern operating approaches to develop agricultural production at an appropriate scale, with relatively high levels of production specialization, standardization, and commercialization, and with economic, ecological, and social benefits noticeably higher than the local average level of agricultural production. Its connotation standards should encompass 8 aspects:

① The rural household serves as the basic unit. The family farm owner should have rural household registration, that is, be a local rural household. While respecting farmers' voluntary choice, the meaning of household can be extended to grandparents, parents, children and grandchildren, and even other relatives. Urban residents and industrial and commercial capital may enter the agricultural sector, obtain land management rights through transfer, and carry out business activities, but at present they should not be included in the category of family farms.

② It is based on the primary industry. With the development of the primary industry as the foundation, integrated production, processing, and sales operations may be developed. However, farms that focus mainly on leisure tourism, that is, the tertiary industry, with the primary industry attached should not be included in the category of family farms.

③ Appropriate-scale operation. The operating scale of a family farm is not better simply because it is larger. The standard should be scientific resource-use efficiency and maximization of labor productivity and land utilization rate, with appropriate scale scientifically determined according to local conditions.

④ Intensive management methods. As a representative of new productive forces, a family farm lies not only in intensive cultivation of the primary industry, but more importantly in implementing factor reorganization and optimization and industrialized agricultural operation, and through improving the quality of operating factors, increasing factor content, concentrating factor inputs, and adjusting the ways factors are combined to enhance benefits through intensive management, implementing integrated production, processing, and sales, and a comprehensive operating model integrating the primary, secondary, and tertiary industries, thereby achieving the goal of maximizing agricultural benefits.

⑤ Stable operating term. The disadvantage of instability in large specialized farming and breeding households should be overcome, and stable production and operating relationships should be established. For example, for family farms growing rice and vegetables, leased land may currently be considered for at least 10 years or more, fruit tree nurseries for at least 20 years or more, mountain forests for 50 years or more, and breeding operations for 20 years or more.

⑥ Professionalization of the family farm owner. To implement mechanized, specialized, standardized, and commercialized production, the farm owner must necessarily have a relatively high educational level and professional technical competence. There should be requirements for the family farm owner's educational level and professional technical ability, and they should have at least a high school diploma and have received training from a professional technical department and obtained relevant professional technical certification.

⑦ Resource rights certificates are legal and valid. Land, water surfaces, mountain forests, and other resources leased or transferred to establish a family farm must go through legal procedures, and legally effective contracts with legal safeguards must be signed.

⑧ Benefits are higher than the local average level of agricultural production. With the premise of protecting environmental resources and pursuing relatively high ecological benefits, with the goal of maximizing economic and social benefits, and with the direction of serving society, solving employment, and safeguarding the stable development of the rural economy and society, it is necessary to ensure that the three types of benefits of the family farm are greatly higher than the local average level. In particular, behavior aimed at land enclosure, extensive operation, and predatory operation must be prohibited, and actions that damage agricultural resource and environmental conditions must be prevented.

To develop family farms, it is necessary to adhere to the principles of overall planning and classified guidance, and promote the orderly development of family farms. Specifically, efforts should focus on five aspects:

First, use large households as the foundation and gradually upgrade. A family farm can be said to be the “upgraded version” of a specialized large household. ① Upgrade in entity status. After a specialized large household is registered with industry and commerce as a family farm, its production and operation can independently bear legal responsibility. With the continuous improvement of relevant policies, it can also obtain a series of preferential support policies in areas such as loans. ② Upgrade in operating stability. In terms of land transfer term and scale, a family farm is more stable than the large number of large households with 3-5 year contract periods and terms that change at any time. ③ Upgrade in industrial development. Because the family farm's operating term is relatively long, the farm owner can overcome the psychology and behavior of short-term development, formulate relatively long-term development plans, increase investment, and gradually extend development toward the secondary and tertiary industries such as agricultural product processing and sales, implementing integrated production, processing, and sales, and achieving an improvement in the level of industrial development. ④ Upgrade in benefits. A family farm implements intensive management and comprehensive industrial development, and regardless of whether it is economic, ecological, or social benefits, all should be higher than those of ordinary large specialized farming and breeding households.

Second, use specialization as the foundation and gradually become comprehensive. Family farms can be divided into specialized and comprehensive types. The specialized type is further divided into planting-type family farms and breeding-type ones; the comprehensive type is divided into the combination of planting and breeding type and the combination of agriculture and animal husbandry type. The development of family farms is a gradual process, affected by many aspects such as capital, technology, land transfer, and owner quality. They should be guided to base themselves on their own conditions and become larger and stronger on the basis of existing planting or breeding.

Third, use small and medium-sized farms as the foundation and gradually grow stronger. Internationally, countries with relatively developed modern agriculture all emphasize the development of small and medium-sized family farms. Small and medium-sized family farms in the United States account for more than 87% of the country's total family farms; small and medium-sized family farms in Canada account for more than 90%, and large farms of more than 500 hectares account for only 10% of the total number of farms. China has little land and many people, and land is collectively owned. Considering the national conditions and multiple factors comprehensively, the development of family farms should focus on supporting the development of small and medium-sized farms, and guide them to gradually grow stronger. Based on an analysis of the current situation of large grain-growing households in Hunan, those with 50-500 mu of medium and small scale account for more than 95%, and this should be the foundation for the development of family farms.

Fourth, use the family as the foundation and gradually expand. A family farm can exist independently or become a component of other economic entities, such as becoming a member of a farmers' cooperative, or contributing shares to establish an agricultural enterprise. Compared with farmers' cooperatives and leading agricultural enterprises, family farms still lag behind in the role they play in promoting the scaling up and modernization of agricultural production. While steadily developing family farms, they should be actively guided to form farmers' cooperatives, contribute shares to establish leading agricultural enterprises, and other “advanced versions” of entities, gradually forming a higher-level new type of agricultural operating consortium.

Fifth, use policy as guidance and gradually standardize. The government should formulate policy measures in areas such as fiscal subsidies, tax reductions and exemptions, production insurance, and financial support to guide the orderly development of family farms and support their development. At the same time, it should formulate relevant systems for registration and standardized management.