Target Price System Promotes Market Adjustment Of Industrial Chain

In 2014, the Central Document No. 1 put forward a sound price mechanism and set up a target price system. First, we conducted experiments on cotton in Xinjiang, northeast and Inner Mongolia.

"Target price is a subsidy way that is linked to the market price of specific agricultural products."

Determine a target price and subsidize the spread when prices fluctuate, so as to compensate farmers' income and promote the steady development of agriculture.

The government should determine the profit according to the production cost, importance and price ratio of specific agricultural products, and the principle is to compensate production costs and promote profits.

Du Ying introduced that the target price was announced before planting every year, which is essentially a price support policy, characterized by not disturbing the market and directly subsidized farmers. Many countries use this policy.

In April 2014 and May, the national development and Reform Commission announced the target price of Xinjiang cotton and Northeast soybean. The cotton price was 19800 yuan per ton, 20400 yuan per ton than 2013, 600 yuan per ton, soybean was 4800 yuan per ton, 200 yuan higher than the 4600 yuan / ton in 2013.

"The price of cotton market is expected to be 13500 yuan / ton this year. The main production areas in Xinjiang are subsidized according to the difference between the target price and the actual price, that is, the subsidy per ton is 6300 yuan, and the subsidy per ton in the mainland is 2000 yuan.

According to the calculation of 100 kg of lint cotton in a medium-sized land, the mainland farmers can get 200 yuan subsidy for one mu of land, and a loss of 600 yuan per mu, so next year farmers will choose not to plant cotton, so that cotton prices will gradually recover.

Chen Xiwen introduced.

Du Ying said it did so because the government wanted cotton planting to be concentrated in Xinjiang from the Huang Huai sea area.

"In the current international market price of agricultural products, the mainland is not suitable for producing cotton."

Chen Xiwen said.

The target price of soybeans is higher than that of last year's temporary purchase and storage, because "no domestic soybean planting area can be reduced."

In addition to Chinese soybeans, soybeans in other countries are high in fat content and low in protein content. Only China's soybean protein content is relatively high. Soya bean milk and tofu must be made in China. The soy sauce soup from Japan and Korea is also made from Chinese soybean. To meet the demand, 13 million to 14 million tons of output should be guaranteed.

Chen Xiwen explained.

Huang Jikun believes that although the target price has been implemented, the price difference between cotton and domestic products has dropped from 50% over 2011-2013 years to 27% at the end of 2014, reducing direct intervention in prices and easing domestic inventory pressure, but the operability of this reform has problems.

According to his calculations, cotton target price subsidies in Xinjiang amounted to more than 250 billion yuan this year.

At the same time, 60% of the subsidy will be paid according to the area and 40% according to the sales volume. The verification of cotton area will cost huge labor costs, and there will be risk of corruption when invoicing.

Du Ying said that there are some problems in the operation, such as the difficulty in verifying cotton area and the difficulty in verifying the amount of cotton sold.

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There are some problems in the operation, such as the difficulty in verifying cotton area and the difficulty in verifying the amount of cotton sold.

"There is too much land reclamation in Xinjiang, and illegal reclamation can not be identified. It is more difficult to define illegal and lawful."

The subsidy 60% is "complicated" based on the area and 40% according to the sales volume, but the verification area can be regarded as a one-time cost.

"The problem of operation is not difficult to solve."

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It appears that

At present, the policy is progresses smoothly. The market pricing mechanism has begun to play a role. Unlike the past, it has been singled out by the grain reserves, the central storage cotton and its entrusted agencies, but it has achieved multi-channel acquisition. "Xinjiang has set up more than 800 flower factories, which can be acquired through qualification, and the difference between domestic and foreign prices is obviously reduced.

In 2013, the difference between domestic and foreign cotton per ton was 4670 yuan, the most recent 2000 yuan. Our inventory pressure has improved, and about 10000000 tons of cotton piled up in the Treasury. If we do not engage in target prices, inventory will increase, and money will be hit there, and this year will not increase again; the efficiency of cotton spinning enterprises has been improved, although the price of cotton yarn is down, but the price of cotton is lower, so the enterprises benefit.

Du Ying estimated that cotton farmers' income may be less than that of last year. "This is the price that must be paid for the excessive price increase in the past, but also the throes of reform, but the whole industrial chain is alive."

In the past, cotton enterprises could not live. In the future, some cotton farmers would have to go to spinning instead of growing cotton. Overall, the effect was good.

Huang Jikun believes that the future of Chinese agriculture is not to increase subsidies, but to clarify land property rights, pform agricultural production and operation mode, reform scientific research system, promote agricultural progress, perfect market, improve the international environment and increase investment in infrastructure.

However, more policy makers stressed that subsidies are still important for Chinese farmers and agriculture, and that the subsidy mode should be changed, that is, the green box subsidy mode that should comply with the WTO rules.

Du Ying believes that in the future, we should not emphasize too much on the issue of farmers' income through policy subsidies.

In addition, we should appropriately increase tolerance for price fluctuations. "In the past, we were too sensitive to price fluctuations.

An interval should be established, which should be tolerated in the interval. "