2018 Rice Planting Prospect Analysis and Forecast
Looking at the current market situation as well as rice planting costs, weather factors, pests and diseases and other aspects, will there be a protective price for rice (early rice) in 2018? Since the rice market support policy for 2018 has not yet been announced, it is still hard to say. The news currently circulating online about the cancellation of the minimum purchase price for early indica rice in 2018 is only a suggestion from some experts and does not represent national policy. We have now compiled the relevant content here, hoping to bring farmers some help.
At the 18th China Grain Forum held in August, co-hosted by the China National Association of Grain Sector, COFCO Corporation, China Grain Reserves Corporation, the Zhengzhou ( agricultural land, commercial and residential land, industrial land) grain wholesale market, the Zhengzhou Commodity Exchange and the Dalian ( agricultural land, commercial and residential land, industrial land) Commodity Exchange, and organized by Hunan ( agricultural land, commercial and residential land, industrial land) Grain Group Co., Ltd.,
Cheng Guoqiang, a researcher at the Development Research Center of the State Council, suggested in his report on "Several Issues in the Reform of the Grain Purchase and Storage System": prepare for adjusting the minimum purchase price of wheat in 2018, lowering the minimum purchase price by 0.03 yuan/jin to 1.15 yuan/jin. Starting from 2018, suspend the implementation of the minimum purchase price policy for early indica rice, and lower the minimum purchase price of japonica rice by another 0.1 yuan to 1.4 yuan; lower the price of mid-to-late indica rice by another 0.06 yuan/jin to 1.3 yuan/jin; in 2019, further lower the price level based on a comprehensive adjustment according to indica rice prices and the overall grain supply and demand situation.
Subsequently, in October, the 2018 wheat market support price announced by the National Development and Reform Commission was exactly consistent with Dr. Cheng Guoqiang's prediction, so this suggestion was recently brought up again, and some self-media outlets that did not understand the real situation directly reported it as the state canceling the early rice market support in 2018.
Therefore, the specific policy still has to wait for the state's policy release.
In addition, from a personal understanding, although the policy has not yet been announced, many things do not come from nowhere. Since experts have made such a suggestion, the possibility of cancellation next year should be relatively high.
In fact, under China's market support policy for many consecutive years, China's grain stocks have climbed year after year; correspondingly, grain imports have also been continuously increasing, while at the same time the gap in the high-end grain and oil consumption sector has been growing day by day. Although the state has gradually strengthened control over grain quality during purchasing and changed the previous mixed purchasing situation, the results have not been obvious. Grain production's “emphasis on quantity rather than quality” has become an iron fence restricting the upgrading of China's grain industry. Large amounts of grain cannot be smoothly released from warehouses and gradually turn from new grain into old grain.
Data from the industry institution Zhuochuang Information shows that as of August 2017, China's total rice stock in grain depots reached more than 120 million tons, and the pattern of supply exceeding demand was relatively obvious. In the minimum purchase prices for rice announced by the state in 2017, the price for early indica rice had already been lowered for two consecutive years, and the price for mid-to-late rice was also lowered for the first time since the policy was implemented fourteen years ago. The general trend of de-stocking rice can no longer be changed.
How much does it cost to plant one mu of rice?
1. Non-labor costs
Including expenditures on seeds, pesticides, fertilizers and other aspects.
Cost: about 400 yuan
2. Labor costs
Labor costs for field management
Leveling seedling fields, accelerating germination and sowing, and weeding require about 1.5 labor-days;
Cultivating, leveling and building ridges in rice fields, about 1 day;
Fertilizing and preventing pests and diseases, about 2.5 days;
Cost 500 yuan: calculated at 100 yuan per person per workday, 5 days in total
Labor or agricultural machinery costs for harvesting
Agricultural machinery harvesting cost: an average of 100 yuan per mu
Or
Hired manual harvesting cost: an average of 150-200 yuan per mu
Total cost excluding labor: 400 yuan/mu; total cost with hired labor (or agricultural machinery): 1000-1100 yuan/mu
3. What is the profit when the minimum purchase price is implemented?
Ignoring rice quality here, assuming a yield of 1000 jin per mu, and calculating everything according to the 2017 minimum purchase price for early indica rice of 1.3 yuan/jin, the income per mu is 1300 yuan.
Depending on the degree of hired labor for field management and harvesting, the final income per mu is between 250 yuan and 950 yuan.
In the long run, rice will eventually shed the cloak of state government protection and conform to market price changes, so that even cheaper rice will not enter the Chinese market. Finally, with the overall policy trending positively, more attention should be paid to the speed of de-stocking state-reserved rice in 2018. If the huge stock cannot be absorbed, the road to rice purchase and storage in 2018 will remain full of difficulties.