How does agriculture chart its path in an era of high costs?

Right now, land transfer has become the hottest phrase in rural areas.

According to incomplete statistics, in Gaoqing County, Shandong Province, the number of villages participating in land transfer has reached more than 500, accounting for 65% of the county's total villages. At the same time, transfer fees are also quietly changing, gradually becoming a factor that cannot be ignored in agricultural production input.

On one side, farmers who transfer out their land hope to get a good price; on the other side, the land transferee must carefully calculate to reduce costs. And the rise and fall of transfer fees depends not only on both sides, but is the result of multiple factors working together. Agricultural production will therefore take on a different appearance from the past.

Do the math: just how precious is land?

The rent for contiguous land has already exceeded 1000 yuan per mu, and for grain-growing farmers the money spent renting land accounts for about half of total costs

The weather in July is exceptionally hot. On the land of Taili Village, Changjia Township, Gaoqing County, there has been no precipitation for many days, and the leaves of the corn seedlings, more than half a meter tall, look a bit wilted.

The weather forecast says it will rain in the next couple of days, and 49-year-old Li Hongwu is only hoping it will start early. From 2011 to now, the land area he has transferred has expanded from the initial 200 mu to 500 mu. What is even more rare is that he has always insisted on using most of the land to grow grain.

"At the beginning it was 1000 yuan per mu. At the time that was already not low, and now at this price you basically cannot rent it. For contiguous land like this around here, it all takes about 1200 yuan." Growing grain alone puts considerable pressure on Li Hongwu. "If the price goes any higher, those of us growing grain definitely would not dare take it on. It would absolutely be a loss."

Having grown grain for many years, Li Hongwu had long since run the numbers several times. Growing wheat and corn, one mu of land for two seasons a year can bring in only about 2200 yuan; after deducting various costs, net profit is no more than 300 yuan to 500 yuan.

"The money for renting land accounts for about half of total costs. At the current price there is still a little money to be made, but only in a year with favorable weather." What Li Hongwu worries about most is encountering a natural disaster, which could make it difficult even to break even.

By comparison, Ma Fulong of Majia Village, Tianzhen Subdistrict Office, is much more relaxed. Since 30 years ago, the people of Majia Village began growing nursery stock, and the returns have always been considerable. Around 2008, Ma Fulong tried transferring land nearby, and now the scale has expanded to more than 1500 mu. In the not-large Majia Village, more than 10 households have already transferred land to grow nursery stock.

"Rent accounts for only about 1/8 of total costs. Even if it rises by another one or two hundred, it is not a big problem." Although rent has risen from the initial 700 yuan/mu to 1100 yuan/mu, Ma Fulong is not under much pressure. "In the first few years when the market was good, one mu could earn ten thousand or eight thousand; now it is still all right, around five or six thousand yuan."

Within Gaoqing County, the cost of transferring land is open and transparent. If land is transferred from an individual farmer, although there are no shortage of examples at three to five hundred yuan per mu, as long as the land is in contiguous plots, it is basically between 1000 yuan and 1200 yuan per mu. In Shandong Province, such a price is not considered high; in some places the transfer fee has already approached 2000 yuan.

Ask the reason: who gets to decide the price?

Grain prices show an obvious upward trend, land transfer fees rise accordingly, and the level of the price is also related to location

Suoyi Fan Village in Changjia Township is surrounded by water on three sides, with a wetland area of more than 4000 mu. Its unique natural conditions make it a "land of fish and rice" on the banks of the Yellow River. The Shuoguo Rice Planting Professional Cooperative, initiated and established by Liu Shuhai, has basically covered most of the surrounding farmers and land.

"When we first started transferring land, there was no experience to follow. At the time the price for temporary rental of industrial land was 1000 yuan/mu, and our transfer price was basically set according to that." Considering that rent might rise in the future, Liu Shuhai also reached a tacit understanding with the villagers. "Refer to the rental price of contiguous cultivated land of more than 300 mu within Gaoqing County, and then make corresponding adjustments."