China to deepen reforms of agriculture sector to boost rural areas

  • Policy statement outlines broad goals including plan to revive domestic soybean production
A farmer picks tea leaves in Mianxian county, Shaanxi province. Beijing’s policy document reiterated a strategy to improve income levels and living standards in China’s countryside. Photo: Xinhua
A farmer picks tea leaves in Mianxian county, Shaanxi province. Beijing’s policy document reiterated a strategy to improve income levels and living standards in China’s countryside. Photo: Xinhua
China will deepen reforms of its agriculture sector to promote its rural economy, the government said in its first policy statement of 2019, as it seeks to bolster growth and offset trade challenges.

Beijing’s statement, released late on Tuesday, comes after the world’s second-largest economy saw its weakest growth in 28 years in 2018 and remains entangled in a trade war with Washington.

“Under the complicated situation of increasing downward pressure on the economy and profound changes in the external environment, it is of special importance to do a good job in agriculture and rural areas,” the government said in the document issued by the State Council and published by official news agency Xinhua.

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Known as the “No 1 document”, this year’s policy reiterated a rural rejuvenation strategy first laid out in 2017 to improve income levels and living standards in China’s countryside.

It also highlighted a plan to boost domestic soybean production but did not offer further details.

Chinese President Xi Jinping visits a farm in northeastern Heilongjiang province during an inspection tour in September. Photo: Xinhua via AP
Chinese President Xi Jinping visits a farm in northeastern Heilongjiang province during an inspection tour in September. Photo: Xinhua via AP

Industry analysts said on Wednesday they were eagerly awaiting further details to assess the impact of the plan, which had already been flagged by Agriculture Minister Han Changfu earlier this month.

China has been overhauling its crop structure in recent years, reducing support for corn after stocks ballooned, and seeking to promote more planting of oilseeds that it mostly imports.

That goal has become increasingly important since a trade war with the United States, which led China to slap tariffs on soybean imports, tightening domestic supplies.

Han has previously urged authorities in China’s northeast to support soybean production through subsidies and called for rotating of soybeans with other crops including corn and wheat.

Beijing also aims to support the production of rapeseed in the Yangtze River Basin, according to the document.

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As in previous years, it also called for stable grain production, but also an increase in imports of agriculture products where there are shortages in the domestic market.

“The focus now is on retaining production capacity, in the form of high quality farmland, and using the international market to make up production shortfalls,” said Even Rogers Pay, an agriculture analyst at China Policy, a Beijing-based consultancy.

The reference to imports is positive for trade partners like the United States, said Cherry Zhang, analyst with Shanghai JC Intelligence, who said it raised the likelihood that China will buy more US agriculture products.

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Shares of Chinese livestock companies, along with pig and poultry breeders, rose on Wednesday following the release of the policy paper.

The document also outlines plans to accelerate development of a new farm subsidy policy system and further crack down on the smuggling of agriculture products.

Additionally, the government said it plans to strengthen the monitoring and control of African swine fever outbreaks, after more than 100 cases were reported in China since August.

Other plans include continuing to tackle rural pollution and promoting recycling of agricultural waste such as manure and agricultural film.

Source: SCMP

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