Four major issues affecting China's agricultural market in 2018

Four major issues affecting China’s agricultural market in 2018Four major issues affecting China’s agricultural market in 2018

Xinhuanet, Beijing, January 17th (Wang Ya) The Ministry of Agriculture held a press conference on key agricultural product markets in Beijing on the 17th. Tang Ke, director of the Department of Market and Economic Information of the Ministry of Agriculture, pointed out at the conference that the overall supply and demand of agricultural products in the world will continue to remain loose overall. In the context of China’s agricultural supply-side structural reforms, China’s agricultural product market operation is expected to continue to maintain overall stability. However, the external uncertainties are superimposed, and China’s agricultural product market situation will become more complicated. Four major issues need to be addressed.

The first is the impact of the reduction in the minimum purchase prices for rice and wheat. Under the premise of adhering to the minimum purchase price policy framework, the state appropriately adjusted the minimum purchase price levels of rice and wheat from the previous year in accordance with changes in production costs, market supply and demand, etc., which not only released the signal of the reform of the grain collection and storage system, but also a market mechanism. Space for role.

It is expected that the market-based purchase and sales of rice and wheat will be more active this year, and the characteristics of high quality and better prices will become more apparent. However, the impact of price reductions on the production process needs to be comprehensively tracked and analyzed, and corresponding supporting policies must be improved to ensure that farmers in the main producing areas have a basically stable income from grain production.

Second, the new changes in the production and marketing situation of corn need to be focused on. In 2017, the progress of corn stock digestion exceeded expectations, and the trend of stable and strong market prices also exceeded expectations. Especially at the end of November, the purchase and sales of corn in Northeast China were active, the volume and price went up, and the benefits of corn planting were significantly better than the previous year. According to preliminary planning by experts, it is expected that farmers ‘enthusiasm for corn planting in Northeast China will increase in 2018. It is necessary to closely track changes in farmers’ planting intentions, coordinate the corn and soybean producer subsidies and crop fallow subsidy policies, and continue to guide corn production to advantageous areas through policies.

Thirty-three is the intensified international competition that needs to be addressed. In recent years, the global grain supply and demand relationship have remained loose, and production and inventory growth have continued to fall with prices. According to data from the Food and Agriculture Organization of the United Nations, world cereal production increased from 2.294 billion tons to 2.610 billion tons in 2012-2016, with an average annual growth rate of 3.3%. . In the past four years, the average world cereal output has exceeded demand, and the ending stocks have increased by 32.2%. The food price index of the Food and Agriculture Organization of the United Nations has fallen from 213 in 2012 to 161 in 2016, a cumulative drop of 52 points.

According to the latest FAO forecast for December 2017, global cereal supply and demand for 2017-2018 is still loose. It is expected that the pressure on China’s bulk agricultural products imports will remain relatively large in 2018, and imports of specialty grains, fruits, vegetables, aquatic products and branded foods will continue to grow rapidly, and China’s agricultural development is facing increasingly fierce international competition.

The fourth is the conduction effect of macroscopic factors. In recent years, with the enhancement of the financial attributes of agricultural products and the improvement of agricultural industrialization, the influence of external factors on agriculture has continued to deepen. The first thing to pay attention to in 2018 is the sharp increase in fertilizer prices, which will increase agricultural production costs. We need to ensure the supply of spring fertilizer and fertilizer to prevent the increase in costs and downward grain prices, which will dampen farmers’ production enthusiasm. Secondly, we need to pay attention to the rise in inflation expectations, and rationally treat the recovery in the prices of some agricultural products such as beef and mutton, as well as seasonal and cyclical fluctuations, to prevent excessive speculation on the normal fluctuations in the agricultural product market.

In addition, Tang Ke reminded that we should also pay attention to more complicated and changeable international situations, especially the impact of peripheral factors such as the Fed’s continued rate hikes, sharp US tax cuts, and crude oil price fluctuations on the operation of agricultural markets.

Tang Ke said at the meeting that there are many factors affecting the operation of agricultural product markets. In addition to supply and demand fundamentals, there are many aspects such as regulatory policies, import and export trade, and macroeconomics. Therefore, it is difficult to make relatively accurate forecasts, but it is possible to We will sort out the key issues that affect the operation of the market, do a good job of research and judgment in advance, prompt market risks, and formulate a response plan to prevent large fluctuations in production and the market.

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