Agricultural machinery cooperatives become the encouraged direction for land transfer

In recent years, the central government has been increasing its support for agriculture, and some have asserted: “agriculture is the biggest gold mine in our country over the next 30 years”. Against the policy backdrop of land transfer and appropriately scaled agricultural operations, “capital flowing to the countryside” is increasing. For rural areas that have long lacked capital input, this is undoubtedly a good thing.

At present, in some areas, land transferees unilaterally break contracts or even abscond, and land rent is hard to collect. The returned land either has lost its boundaries, or has seriously damaged motor-pumped wells and pipelines, or even misses the farming season and is left abandoned. Among the “bosses” who go to the countryside to farm, some are driven by a simple affection for agriculture, some have seen the state’s strong support for agriculture, and some think farming is easier than other industries. It cannot be ruled out that a few individual capitals enter agriculture for the purpose of obtaining state subsidies, or even for the purpose of “land enclosure” or non-agricultural use. Because of a lack of in-depth understanding of the basic attributes of agriculture and the complexity, long-term nature and risk of agricultural investment, blind investment by capital going to the countryside has resulted, which has also made land rent rise again and again, while farmers who truly want to farm cannot obtain transferred land. As a result, the ones who lose money are the capital that went to the countryside, and the ones who are hurt are farmers and agriculture. (For details, see the April 20 China Youth Daily article “Capital Going to the Countryside: Able to Compete for Land, Not Able to Farm”)

Last year, the “Opinions on Guiding the Orderly Transfer of Rural Land Management Rights and Developing Appropriately Scaled Agricultural Operations” issued by the central government (hereinafter referred to as the “Opinions”) clearly stipulated: “Industrial and commercial enterprises leasing farmers’ contracted land shall implement tiered filing according to area, strictly enforce the entry threshold, strengthen ongoing and ex-post supervision, prevent waste of farmland resources and damage to farmers’ land rights and interests, and prevent contracted farmers from suffering losses due to breach of contract or poor management by the transferee.” But in reality, land transfer is a “decentralized market transaction” between enterprises and farmers, and ongoing and ex-post supervision is very difficult. To solve this problem, the key lies in choosing the right subject of land transfer. On this issue, the “Opinions” also stipulated: “Actively promote trusteeship service models that neither change farmers’ contracting relationships nor leave land uncultivated, encourage large grain-growing households, large agricultural machinery households and agricultural machinery cooperatives to carry out full-process trusteeship or trusteeship of major production links, and realize unified cultivation and scaled production.”

Therefore, specialized agricultural machinery cooperatives should become the primary choice for land transfer. The modern agricultural machinery and equipment owned by specialized agricultural machinery cooperatives are of considerable value, which determines that agricultural machinery cooperatives must make full use of agricultural machinery to “farm the land well and harvest the grain well” in order to recover costs as quickly as possible, and can effectively prevent land transfer from becoming non-agricultural or non-grain; in order to strive for a bumper harvest, agricultural machinery cooperatives are more willing to work hard on improving cultivated land quality, such as returning straw to the field, deep loosening and deep plowing of land, etc.; transferring land to agricultural machinery cooperatives is flexible in form, such as complete transfer, operation transfer, cooperative transfer, etc.; members of agricultural machinery cooperatives use modern agricultural machinery for production, which makes them understand modern agriculture better. This is a “good school” for cultivating new professional farmers, and also a “good path” for increasing the scientific and technological content of our country’s modern agriculture.

Agricultural machinery cooperatives can also achieve the optimization of combining appropriately scaled operations with production efficiency. Deng Yuzheng, director of the Hengyang County Agricultural Machinery Bureau in Hunan Province, believes: “From the perspective of the best combination of production efficiency and economic returns, a small agricultural machinery cooperative farming 300 mu is most suitable. This scale can maximize the effectiveness of one large tractor, one rice transplanter and one harvester, and annual income may reach about 200,000 yuan. If there are 2 sets of such agricultural machinery and equipment, 600 to 700 mu of land can be transferred, and the annual economic return can reach 400,000 to 500,000 yuan. If there are 3 sets of such agricultural machinery and equipment, about 1,000 mu of land can be transferred, and the annual economic benefit can reach 700,000 to 800,000 yuan. For farmers who lack capital but know how to farm, these scales are affordable by setting up an agricultural machinery cooperative, and the benefits are quite considerable.”