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Opinion / Op-Ed Contributors

Accelerate agricultural supply-side reform

By Song Hongyuan (China Daily) Updated: 2016-01-29 08:13

Accelerate agricultural supply-side reform

The central government is investing more in biotechnology and working with foreign companies to boost farm production. Photos provided to China Daily

Supply-side reform is the main theme of the No. 1 Central Document on agriculture this year. President Xi Jinping has reiterated that we should properly expand total demand, enhance structural reform of the supply side, increase the quality and efficiency of the supply system and strengthen sustainable economic growth impetus. The State Council, China's cabinet, also advanced cultivating new supply momentum to expand domestic demand.

The focus on supply-side reform shows the leadership's new understanding for China's macroeconomic policy and its emphasis in the future.

With supportive and preferential policies, China has made great achievements in agricultural and rural economic development. Crop production has increased for 12 consecutive years, and there's an abundant supply of major agricultural products. However, there are also many contradictions that need to be addressed.

On the one hand, China's agricultural products don't satisfy the demand, which has resulted in a structural imbalance in the supply of agricultural products. For instance, the production, import and stock of crops have all increased recently. But while there is a basic balance between the production of and demand for wheat and rice, there has been a periodic oversupply of corn and a short supply of soybean in recent years.

Meanwhile, the amount and quality of arable land is declining, the underground water supply has been depleted and there is ever-increasing agricultural nonpoint source pollution.

Agricultural supply-side structural reform aims to comprehensively increase the supply of major agricultural products, focusing on the quality and the effectiveness of their supply rather than solely seeking production increases.

The key to accelerating agricultural supply-side reform is to improve the quality and efficiency of the supply of agricultural products to satisfy consumers' demands.

From now on the major agricultural policies will focus on destocking, reducing costs and making up for deficiencies.

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