Director of the State Farms Bureau of the Ministry of Agriculture: Cultivate international grain giants in the state farm system
As a strategic material and a special commodity, grain has a use value that is irreplaceable, and the price elasticity of supply and demand is relatively low. Practice has proven that in the grain sector, the most effective way to give play to the decisive role of the market and better play the role of the government is to cultivate international grain giants with market pricing power, using the hand of the government and market-oriented operating methods to achieve macroeconomic regulation goals. As large state-owned agricultural enterprises, state farms must take the cultivation of international grain giants as a strategic carrier and platform, ensure national food security, and play an important role in the overall economic and social development.
In cultivating international grain giants in the state farm system, the primary goal is to safeguard national food security and ensure that the prices of major agricultural products are regulated at a reasonable level
China is the world's most populous country and a major grain producer, consumer and importer. In recent years, with rapid economic and social development, the relationship between supply and demand of agricultural products has begun to shift toward a basic overall balance with structural shortages, and will remain in a state of tight balance for a long time to come. Tight balance is the ideal state for food security, but it is also a high-risk state. It is necessary both to prevent insufficient supply from causing “high rice prices hurting the people” and to prevent loose supply from causing “low grain prices hurting farmers.” The initiative in macroeconomic regulation must be firmly kept in hand at all times. Therefore, cultivating international grain giants in the state farm system must proceed from China's national conditions and from the new situation in food security. They can be neither equated with ordinary multinational agricultural companies whose purpose is to maximize profits, nor with the international grain giants of developed countries whose purpose is to dump surplus agricultural products abroad. State farm international grain giants are first and foremost international grain giants that guarantee China's food security; they are China's homegrown grain giants, and in their development they must calculate not only the “economic account” but also the “political account” and the “social account.”
In cultivating international grain giants in the state farm system, efforts must be focused on enhancing domestic production capacity for major commercial grain and actively striving for a voice in international grain and agricultural product markets
China's resource endowment of many people, little land and scarce water determines that ensuring food security requires concentrating efforts on protecting the basics, ensuring basic self-sufficiency in cereals and absolute security of staple grains, while at the same time selecting appropriate opportunities to import grain in a moderate and appropriate manner to adjust the market. If we place all our hopes for the problem of feeding ourselves on the international market, we will not only be constrained by others and pay a high price, but from the perspective of the world grain trade and distribution system, it is also unrealistic, unreliable and unsustainable. State farms have the unique advantage of numerous production bases. State farm international grain giants are first and foremost producers, and must always adhere to the principle that “our rice bowl should mainly hold Chinese grain.” Domestically, state farms must base themselves on the reclamation areas, and then through industrialized services “step out of the reclamation areas,” striving to build green, mobile large granaries, and striving to directly control a total of more than 100 billion jin of commercial grain by 2020, playing a key role in ensuring grain supply, stabilizing market prices, and providing disaster relief and emergency assistance, truly becoming the “handful of rice” that gives the Party and the state peace of mind. At the same time, state farm international grain giants must establish a global vision, accelerate the pace of transnational operations, deploy warehousing and logistics facilities in the world's major grain-surplus production areas, grasp first-hand grain sources, and directly participate in competition in the world grain market, so as to break from the source and at the root the passive situation in which a small number of monopoly oligarchs manipulate international grain prices. On the one hand, this prevents price transmission from impacting domestic production and farmers' income growth; on the other hand, it can also regulate the international grain market and genuinely shoulder the responsibility of a major developing country.
In cultivating international grain giants in the state farm system, it is necessary to vigorously advance alliances and joint operations and build a “joint fleet” among different types of entities
From a global perspective, there is no universally applicable development model for international grain giants. Although they share certain common features, they are more often formed through evolution based on factors such as the resource endowment, history, culture and economic system of their home countries. State farm international grain giants must not only absorb the useful experience of international grain giants in developed countries, but also give play to the advantages of the socialist system with Chinese characteristics, extensively mobilize and unite the forces of all sides, and form a development model suited to China's national conditions. Vertically, state farm international grain giants must build an entire agricultural industry chain with full traceability of quality, from cultivating production capacity to supply capacity, and then to cultivating market competitiveness, forming an integrated development pattern in which large reclamation area groups lead industrial companies, state-owned farms, new types of business entities and traditional farming households, and forming the ability to control strategic agricultural industries. Horizontally, state farm international grain giants must, on the basis of forming close connections among reclamation areas, comprehensively build strategic alliances covering local governments, research institutes, financial capital, private enterprises, collective economic organizations and non-governmental organizations, vigorously develop the mixed-ownership economy, and amplify the influence and control of the state-owned economy of the state farms.
State farm international grain giants are grain giants rooted in rural areas. They possess production bases linked by property rights and form a new type of economic community with the vast numbers of agricultural workers and farmers. State farm international grain giants must not only occupy the high end of the industry chain, but also lead farmers into the market with advanced factors of production, protecting and enhancing farmers' economic interests. By incorporating farmers' household operations into the enterprise operating system, state farm international grain giants, on the one hand, build stable channels for farmers to find employment and start businesses locally and nearby, promoting the process of farmers becoming urban residents in place, becoming professionalized, and the new type of urbanization; on the other hand, using enterprises as the carrier, they realize the two-way flow and equal exchange of factors of production between urban and rural areas, and comprehensively stimulate the driving force for the synchronized development of the “four modernizations.”
(The author is Director of the State Farms Bureau of the Ministry of Agriculture)