Storing Grain Among the People Is Quietly Changing, Challenging Traditional Rural Grain Storage Models

The Wanxin Agricultural Machinery Professional Cooperative in Shanqian Village, Gongzhuling City, Jilin Province, planted more than 9,000 mu of corn this year and plans to build a grain storage warehouse with a capacity of 30,000 tonnes. The photo shows the land already selected by the Wanxin Agricultural Machinery Professional Cooperative for building grain storage facilities.

At present, China faces enormous pressure on grain storage capacity, and "storing grain among the people" is a very effective way to ease that pressure. Chinese farmers have always had the habit of storing grain, and household grain storage accounts for about 50% of the national total output, playing a positive role in ensuring national food security. However, in recent years ordinary farming households' willingness to store grain has declined, while the willingness to store grain has risen among new types of agricultural business entities such as farmer cooperatives, family farms and specialized large-scale growers. The changing trend of rural grain storage poses a real challenge to the traditional rural grain reserve model.

Large-scale grain growers -- eager to build grain storage facilities

Yuan Dongsheng, a family farm owner in Jianshang Village, Xiangshan Town, Chongren County, Jiangxi Province, planted more than 400 mu of rice this year. Previously, lacking drying equipment and a grain warehouse, he had no choice but to sell newly harvested rice directly to the local grain depot. This year he invested more than 400,000 yuan to buy two dryers, one large and one small, and is building a grain warehouse capable of storing more than 200,000 jin of grain. "With drying equipment and a grain warehouse, I can store the grain and sell it when the time is right, getting a good price," Yuan Dongsheng said.

At present, new types of agricultural business entities such as farmer professional cooperatives, family farms and specialized large-scale growers are farming grain on an ever larger scale; some cooperatives farm thousands of mu or even tens of thousands of mu, and grain output keeps growing. Every harvest season, because there are no grain storage facilities, if the grain cannot be sold in time, piling up in large quantities easily leads to mold and spoilage, wasting a whole year's hard work. Therefore, new types of agricultural business entities have an increasingly strong desire to build grain storage facilities.

In recent years, as grain output has increased for many consecutive years, some areas have faced serious shortages of storage capacity. Encouraging cooperatives and large-scale grain growers to build grain warehouses with drying equipment can ease the pressure on storage capacity to a certain extent.

The newly established Zihang Agricultural Development Cooperative in Louhe Town, Xiantao City, Hubei Province, planted more than 2,000 mu of rice this year and has 2 grain warehouses; in June this year it installed 10 grain dryers, with a daily drying capacity of 260 tonnes. Cooperative director Nie Qingping told reporters that they built the grain drying center mainly to dry and reduce the moisture of the grain they purchase themselves and then sell it to grain processing enterprises, while also providing paid drying services to nearby farmers. As the cooperative expands, it will continue to expand its grain storage scale.

For Zhou Yanwu, owner of the Dalan Family Farm in Halaha Village, Zhuchengzi Town, Dehui City, Jilin Province, building a grain storage warehouse with drying equipment is still just a wish. He planted 4,000 mu of corn this year; last year, with government support, he invested more than 100,000 yuan of his own money to install a scientific grain storage bin and also used wooden poles, iron poles and iron mesh to build a simple grain storage bin for storing corn. However, the scientific grain storage bin has a small capacity and is not suitable for larger-scale family farms, while the simple storage bin is too crude, easily causing large amounts of grain waste and unable to guarantee grain quality. Zhou Yanwu and other family farm owners hope to build a grain warehouse with drying equipment in the future.

Selling grain at staggered times --

Achieving maximum returns

Unlike farming households, which store grain to meet basic family consumption needs, new types of agricultural business entities such as farmer cooperatives store grain mainly to maximize the returns from grain farming. Whenever large quantities of new grain hit the market in a concentrated period, grain prices fall for a time; lacking a warehouse to store grain, they have to sell early, so that good grain cannot fetch a good price.

When reporters walked into the meeting room of the Wanxin Agricultural Machinery Professional Cooperative in Shanqian Village, Gongzhuling City, Jilin Province, some materials on grain dryers lay on the desk of Xue Yaohui, chairman of the cooperative. Xue Yaohui told reporters that the cooperative is preparing to buy a small grain dryer and has reached a purchase intention with a dryer manufacturer. The cooperative planted more than 9,000 mu of corn this year, and since last year corn farming has faced difficulties in storing and selling grain; when corn hit the market in a concentrated period last autumn, prices fell, with corn selling for only 0.86 yuan to 0.9 yuan per jin. They stored part of the corn in scientific grain storage bins, and when the corn market improved, it sold for 1.15 yuan per jin. This made him deeply aware that storing grain and selling it when the time is right offers huge profit potential. At present the cooperative has set aside 20,000 sq m of agricultural facility construction land to build a grain warehouse, planning one with a capacity of 30,000 tonnes; the cooperative will use 10,000 tonnes of capacity, and the rest will provide free grain storage services for nearby farmers.

Now more and more cooperatives and large-scale grain growers have recognized the importance of the storage stage for improving grain farming returns. "The storage stage is the terminal stage of grain farming and also the most critical stage for whether grain farming makes money. If grain cannot be stored or cannot be stored well, there is no way to maximize grain farming returns. Improving grain storage capacity and building grain storage facilities with drying equipment allows one to grasp selling timing and market trends and achieve maximum grain farming returns," Xue Yaohui said.

For cooperatives and specialized large-scale grain growers to build grain storage facilities with drying equipment is, in terms of their own economic returns, conducive to maximizing grain farming returns, and in terms of social benefits, can realize "storing grain among the people" and ease the problem of insufficient grain storage capacity. Of course, given the current situation, how to bring grain storage by new types of agricultural business entities into the national grain reserve management system and achieve an organic combination of farmers' economic returns and the social benefits of rural reserves remains a question that needs in-depth discussion.

Shortage of funds --

Support urgently needs to be increased

At present, the construction of grain storage facilities by new types of agricultural business entities is still in its initial stage, plagued by problems of funds, land and so on, and struggling forward, requiring the state to increase support.

BeidahuangStock 854 Agricultural Branch, First Management District, Eighth Operations Station: Ding Shengli planted 4,500 mu of rice this year. He used to sell his grain to a Beidahuang rice processing enterprise; in the past two years, as the minimum purchase price support has risen higher and higher, the grain depot purchase price has exceeded the enterprise purchase price, so he sold his grain to the local grain depot. As early as 3 years ago he planned to build a grain warehouse with a capacity of 2,500 tonnes and drying equipment, requiring a one-time investment of more than 2 million yuan. Last year he spent more than 10 million yuan to buy 12 years of operating rights to 4,500 mu of land, and because of tight funds, the warehouse plan had to be postponed by another two years. He hopes the state can introduce policies to support large-scale grain growers in building grain warehouses, so that they need not rush to sell grain to grain depots, which would not only ease the state's storage capacity pressure but also obtain better economic returns.

Experts believe that if the state encourages new types of agricultural business entities such as cooperatives to build grain storage facilities, it should strengthen services and, from the perspective of increasing grain output, reducing post-harvest grain losses and improving grain economic returns, provide new types of agricultural business entities with the funds, technology and services they need.

Ren Zhengxiao, director of the National Food and Strategic Reserves Administration, said in a recent interview with reporters that actively giving play to social funds investing in grain storage facility construction is of great significance, and that building grain storage facilities by new types of agricultural business entities such as farmer cooperatives, family farms and specialized large-scale growers is an inevitable trend. The state has now clearly proposed to increase support for new types of agricultural business entities; in the field of grain circulation, it is currently vigorously promoting the construction of "grain banks" by business entities such as farmer professional cooperatives, providing farmers with unified drying, unified processing, unified storage and unified sales services, which has better solved the difficulty farmers face in storing grain. Scientific grain storage bins and grain drying technology must be vigorously promoted to meet their growing grain storage needs.

It is understood that since 2007 the state has carried out a special campaign for scientific grain storage by farming households, encouraging farmers to use scientific grain storage bins. By the end of last year, scientific grain storage bins had been issued to 6.77 million farming households, but this is still far from meeting the grain storage needs of new types of agricultural business entities such as cooperatives. Now grain drying equipment has been included in the scope of agricultural machinery subsidies, and new types of agricultural business entities such as farmer cooperatives, family farms and specialized large-scale growers are making full use of the agricultural machinery purchase subsidy policy to build natural ventilation warehouses, drying equipment, drying and storage warehouses and other primary processing facilities. These support policies will undoubtedly greatly stimulate the enthusiasm of new types of agricultural business entities for building grain storage facilities.