How to ease the continuous pressure on major grain-producing areas to increase output

The state takes the people as its foundation, and the people take food as their heaven. Food security bears on the development of the entire national economy and social stability. To raise grain production capacity and ensure food security, China has designated 13 major grain-producing areas. In recent years, grain output in the major producing areas has increased year by year, and their share of national output has consistently remained above 70%, making them the backbone of national food security. However, since 2004 the national grain output has grown for 11 consecutive years, and under existing agricultural resource conditions such as the current yield per unit area, sown area and labor force structure, the major producing areas face considerable pressure to continue increasing output. This is reflected in:

The capacity of the major producing areas to increase grain output is basically approaching its limit. Over the past decade and more, China's grain output growth has mainly benefited from higher yields per unit area, but what sustained this was extensive development methods, namely excessive exploitation of soil fertility and excessive use of chemical fertilizers and pesticides. At present, soil organic matter content in the major producing areas has declined markedly compared with the early years of New China, and nearly 40% of cultivated land has degraded to varying degrees; the average chemical fertilizer use per hectare is about 480 kg, 4.1 times the world average, and the pesticide utilization rate reaches only 30%, with fertilizers and pesticides that are not fully absorbed polluting at least 10% of cultivated land. In addition, the rapid advance of urbanization will further concentrate the transfer of population, land and other agricultural resources to cities, posing a further challenge to the sustained growth of grain output in the major producing areas.

It is becoming increasingly difficult to balance increasing grain output and increasing income within the major grain-producing areas. Since China implemented reform of the grain circulation system in 2001, because of the special mission of safeguarding food security, industrial and agricultural development within the major producing areas has been extremely uncoordinated, falling into the development trap of “major grain-producing province, economically weak province, financially poor province”, making it fairly difficult to “increase income and adjust structure”, and coupled with the relatively rapid rise in the cost of input factors, farmers' enthusiasm for growing grain has continued to decline.

New types of business entities within the major grain-producing areas find it difficult to obtain agricultural financial and insurance services. At present, large grain-growing households, grain-growing cooperatives and leading enterprises have become important carriers of grain production in the major producing areas. Compared with ordinary farming households, the new types of business entities face greater production input and market risks, and their demand for funds and insurance is also stronger. At the same time, agricultural finance develops slowly in the major grain-producing areas, and the supply of agricultural insurance is insufficient, far from meeting the needs of the new types of business entities, which in turn affects the continuous improvement of grain production capacity in the major producing areas.

Infrastructure within the major grain-producing areas remains very weak. In recent years, although the central government's fiscal authorities have continuously increased investment in agricultural infrastructure, investment in farmland water conservancy construction in most major grain-producing areas is insufficient, and water conservancy facilities such as irrigation canal systems are seriously aging and in disrepair; many producing areas still “depend on heaven for their food”, and their capacity to prevent and control natural risks is very weak.

There is a lack of strong policy support within the major grain-producing areas. At present, China's policy support mechanisms for major grain-producing areas lack innovation and still rely on traditional methods such as fiscal rewards and subsidies to major grain-producing counties, without timely adjustment of the comprehensive agricultural input subsidy, the grain price formation mechanism, the benefit distribution mechanism between major grain-producing areas and major grain-selling areas, and the agricultural production and ecological compensation mechanisms, resulting in insufficient complementarity and coordination among related policies on agricultural fiscal investment, prices and trade, and making it difficult for the fiscal predicament of the major producing areas to improve greatly.

Faced with the above realities, how to ensure the due interests of the broad masses of farmers and local governments in the major grain-producing areas while maintaining food security, so that food security achieves sustainable development, is the key to resolving the production pressure faced by the major grain-producing areas. To this end, we recommend:

First, accelerate the optimization of government regulatory means and raise farmers' enthusiasm for growing grain in the grain-producing areas. The central government should speed up the introduction of more preferential policies for key grain-producing areas and major grain-producing counties, further improve the benefit compensation mechanism for grain-producing areas, and can start from four aspects: compensation for the interests of principal entities, compensation for cultivated land protection, compensation for production-sales coordination, and compensation through macro governance mechanisms, combining the grain production behavior of relevant business entities in the major grain-producing areas with spatial and regional economic development, and making compensation systematic, phased and internalized, to ensure the sustainability of food security production.

Second, carry out pilot programs for restoring and rejuvenating agricultural resources in the major producing areas, promptly formulate an overall plan for tackling prominent ecological and environmental problems in the major grain-producing areas, explore more scientific, more ecological and more sustainable ways of developing grain in the major producing areas, and tap new potential for raising grain production capacity. Accelerate the pace of transforming low- and medium-yield fields, and strive to raise land output rate and resource utilization rate through soil improvement, fertility building and cultivated land restoration; accelerate the breeding, application and integrated innovation and extension of breakthrough “new varieties” of grain that are high-yielding, stress-resistant and high-quality, and take an intensive development path that relies on scientific and technological progress to raise yields per unit area; according to the seasonal precipitation characteristics of different regions, rationally adjust the grain planting structure, and in line with the approach of “cutting inferior and expanding superior, cutting summer and expanding autumn”, combine corresponding dryland farming techniques to fully tap the potential of dryland agriculture and create new growth poles for China's grain production.

Third, focus on supporting new types of business entities as important carriers of grain production in the major producing areas, provide guarantees in terms of land transfer, technical equipment, and finance and insurance, and encourage them to carry out various types of business in the pre-production, mid-production and post-production stages. It is necessary to accelerate the resolution of the financial and insurance pressures constraining new types of business entities, encourage local governments to contribute funds or take equity stakes to establish guarantee companies, and the central government should also give appropriate policy and funding support. Innovate financing models for the grain industry chain, and develop financial instruments such as pledges of large agricultural machinery, pledges of grain orders and warehouse receipt pledges. Raise the level of insurance protection for grain cultivation, expand insurance coverage, explore a government-led policy-based agricultural insurance model and a market-led commercial agricultural insurance model, and establish a catastrophe risk diversification mechanism as soon as possible.

Fourth, further delineate core production functional zones within the major grain-producing areas, use these as a platform to strengthen departmental coordination and resource integration, clearly plan various projects such as land consolidation and high-standard farmland construction, and strengthen agricultural infrastructure construction. Take new types of business entities such as large grain-growing households as key targets, focus on strengthening projects such as irrigation and drainage, soil improvement, road improvement, mechanized farming roads and supporting power facilities, promptly issue measures to resolve construction land for grain-drying yards and other facilities for large-scale operating entities, create conditions for scale production, and raise comprehensive grain production capacity.

Fifth, further develop the potential of the major grain-producing areas in technology, land and disaster prevention and reduction work, and ensure that grain output continues to increase. From the perspective of technological potential, the application and extension of improved varieties is one of the important guarantees for raising output in the major grain-producing areas. In 2013, the national grain yield per mu was 358.5 kg, 69.6 kg higher than in 2004; in terms of improved varieties, the yield level of improved varieties trial-planted in some regions still has room for improvement of 50% to 80%. From the perspective of cultivated land quality, after high-yield fields are upgraded and quality-improved, yield per unit area can rise by 5%, and after low- and medium-yield fields are transformed, yield per unit area can rise by 20%, and the two together will add grain output equivalent to more than 100 billion jin. From the perspective of strengthening disaster prevention and reduction work, reducing losses is increasing output; China's crops are affected by meteorological disasters on about 500 million mu to 600 million mu each year, and by pests and diseases more than 7 billion mu-times, and as the level of disaster prevention and reduction in the major producing areas rises, there is still relatively large potential for increasing output in this regard.

Sixth, in accordance with the concept of “large-scale ecological agriculture”, improve the ecological environment of the major grain-producing areas, advance ecological civilization construction, and ensure the sustainable development of the major grain-producing areas. Strengthen cultivated land protection and soil improvement and fertility building in the major grain-producing areas, raise soil quality, and protect soil safety; improve the construction of farmland shelterbelt networks, and around grain-growing functional zones, plant trees in patches and belts along roads and rivers, and combine this with the greening of parks and villages to form a farmland shelterbelt system; increase the development of ecological agriculture, organically combine crop farming, livestock farming, straw ecological industry and biogas industry, and fully develop and use renewable resources.