March 13, 2009

China's state policy of maintaining a 95-percent grain self-support rate is based on the country's reality and anything that causes a reduction of it would affect the world grain prices, Vice Agriculture Minister Wei Chao'an said on Thursday (Mar 12).

 

China is able to maintain its domestic grain price as the state-owned grain depots have larger stockpiles than last year, with the total amount much higher than the international level of grain reserve, Wei said at a press conference held on the sidelines of the national legislature's annual session.

 

He added that China's grain consumption was at 5.15 million tonnes, against a total output of 5.285 million tonnes so the country is fully self sufficient.

 

Wei also said he was confident in a bumper summer harvest despite the severe drought in north China this winter.

 

According to Wei, China's winter wheat crops reached 333 million mu this year, 2 million mu more than last year and the country aims to have about 500 million tonnes of grain output this year.

 

The vice minister said China's efforts to increase farmers' income is facing stern challenges, as the economy suffers from the financial meltdown. He added that the decreasing prices of farm produce and less-than-optimistic job prospects for migrant workers did not help the dire situation.

 

February prices of grain and corn were down 5.1 percent and 11.5 percent, respectively, from last September, according to Wei.

 

The closure of many coastal exporters due to sharp fall in overseas demand has forced 20 million migrant workers to return to their rural homes. Therefore, Wei said the government would try all means to increase farmers' income this year.

 

Premier Wen Jiabao's government work report stated that the central government expenditure on agriculture, farmers and the rural areas would reach RMB716.1 billion in 2009, a year-on-year increase of RMB120.6 billion.

 

Meanwhile, subsidies for grain production and purchase of farming machines would be further increased to RMB123 billion, an increase of RMB20 billion from last year.

 

Wei said the government would raise the minimum purchase prices of farm produce to encourage farmers to grow more. China would also increase its investment in rural infrastructure projects to employ more jobless migrant workers who have since returned to their rural homes.

               

US$1=RMB6.838 (Mar 13)