Jilin Agriculture and Livestock Loan Helps Jilin Farmers Escape Poverty and Become Prosperous

At the Hengsheng Farm in Chang'an Village, Zhenlai, Jilin, looking at the spacious and bright cattle sheds and more than 1,000 sturdy yellow cattle, person in charge Lin Yugui said that his goal of many years is about to be realized.

Lin Yugui has dark skin, and his broad, strong hands are covered with calluses. Now over sixty years old, he usually does not like to talk much, but as soon as the conversation turns to his cattle, his eyes immediately light up and he talks nonstop: "This is not many yet. My goal is to raise 3,000 cattle."

Zhenlai County is located in western Jilin and is a national-level poverty-stricken county, with farmers' per capita annual income of less than 8,000 yuan. Lin Yugui, who once served as the Party branch secretary of Chang'an Village, knows well that without developing industry, it is very difficult for the village to escape its backward and poor condition relying only on a few poor fields.

More than ten years ago, Lin Yugui found that cattle raising had low risk and quick returns, so he decided to give it a try. He used the money earned from his family's liquor brewing to start raising cattle. From feeding fodder to vaccinating the cattle, Old Lin always did everything himself. The farm gradually expanded from the initial few dozen cattle to more than 300 at the beginning of last year. Because of the stable prices and market demand for beef cattle, Old Lin had always wanted to rapidly expand the scale of breeding, but that required a large amount of capital. Because loans for the breeding industry were difficult to obtain, Old Lin was also helpless: "I want to borrow but cannot, and even when I can borrow, it is not enough." This is also a common problem faced by many farmers.

It is difficult for farmers to obtain financing, and even harder for farmers. "The main assets of farmers are biological assets such as pigs, cattle and sheep. Farms are mostly on agricultural facility land and are remotely located. None of these meet banks' collateral requirements," said Gu Yanzhong, president of the Agricultural Bank of China Zhenlai County Branch.

Just when Lin Yugui thought his goal of raising 3,000 cattle was far out of reach, last year the Zhenlai County government cooperated with the Agricultural Bank of China. The government funded the establishment of a risk compensation fund, and the government and the bank shared risk at a ratio of 8 to 2, reducing the bank's risk burden. In this way, farmers only needed to provide collateral that could cover 20% of the loan amount and met bank regulations.

At the end of 2015, the Jilin Provincial Department of Finance, the Animal Husbandry Administration and the Agricultural Bank of China jointly launched a pilot financial product, "Jilin Agriculture and Livestock Loan," dedicated to serving animal husbandry specialized cooperatives and farmers across the province. By establishing a risk compensation fund and building a government credit enhancement mechanism, it gave play to the role of fiscal funds in leveraging much greater results with limited input, and solved the difficulties in obtaining guarantees and loans in the animal husbandry sector.

In May last year, Lin Yugui used a collateral limit of 1.4 million yuan to obtain a bank loan of 7.3 million yuan. He used the loan to expand the cattle sheds and buy 800 beef cattle. Lin Yugui told reporters that beef cattle can be sent to market in six months, and one cow can earn more than 2,000 yuan. By the end of this year, he will be able to raise 3,000 cattle.

Now, Lin Yugui's farm is the largest beef cattle breeding base in the area, and Lin Yugui has become a widely known cattle-raising expert. Having seen the returns brought by developing the breeding industry, many villagers have come to ask how to raise cattle, and Old Lin enthusiastically goes to farmers' homes to teach them how to feed cattle and treat cattle illnesses. Now, Lin Yugui has already driven more than 30 farmers in the town to develop beef cattle breeding. At the same time, through models such as entrusted livestock rearing and dividends, Lin Yugui has also helped increase the income of hundreds of poor households in the town.

In the more than one year since the "Jilin Agriculture and Livestock Loan" was launched, 12 counties in Jilin Province have participated in the pilot, including 3 national-level poverty-stricken counties and 3 provincial-level poverty-stricken counties. In 2016, supported farmers achieved sales revenue of 1.345 billion yuan, a year-on-year increase of 70.25%. As of April this year, the "Jilin Agriculture and Livestock Loan" had cumulatively issued 85,117 yuan in loans, supporting 1,597 farming households.