Try "reserve land" How to

Try "reserve land" How to

China's grain production over the past five years, and there is no doubt that good urban residents, farmers could be brothers, but this is not necessarily good news. More food, supply exceeding demand, the result must be down prices, increasing output without increasing income. And now my concern is that the Government in order to avoid injury Valley agricultural base will re-launch price of food protection. Although it can meet their urgent needs, but by no means a permanent solution. Famen desirable, as is the regulation of food supply and demand. Put it more bluntly, the Government has to spend money instead of purchasing high-priced food, it would be better to spend money to support some of the farmers fallow. Stand point of view of economics, food as a commodity, there must be a balance between supply and demand. We usually talk about economic law, which is the basic rule. By the so-called economic laws, must not leave this point. Of course, the economics also recognizes the special nature of the food, but this specificity, but also in the balance between supply and demand within the limits of logic in order to be recognized. As the saying goes, people are iron, steel rice, eat a starve. Money to a 10,000 color TV sets can not see can not afford to buy, money can be 10,000 pound of food and no one should eat. This means that the consumption of food influenced by the prices relatively low, the demand for its lack of flexibility. On the supply side, a long cycle of food production, higher market prices can not immediately respond. This is not like the production of shirts, if the market good, factory overtime, one will be able to produce a group of late. Farmers are not saying it, Bailu early Cold Dew late autumn wheat was at that time. Missed the farming season, they had no choice but the next year. In the short run, This is also a manifestation of lack of flexibility. Combination of the supply and demand, we see that the special nature of agricultural products: if the food shortages, grain prices will inevitably rise, because supply can not be all of a sudden substantial increase in demand is not too sensitive to price changes, only the high grain prices to the food consumer pressure to eliminate the demand and supply gap; prices on the formation of stimulating production, the coming year, farmers may increase the investment in seed selection, resulting in increased production brought about could be as soon as the supply is greater than demand, prices will drop substantially, the only way in order to stimulate increased demand, excess supply digest. This means that the commodity grain, fully rely on the market, often causing dramatic price fluctuations, Prices plummeted, showing a great exaggeration of course, is the source of supply and demand of its lack of flexibility. To solve the problem of excessive volatility of food prices, means there are two commonly used, namely the protection of price and food reserves. In fact, these two means of regular use. When an over-supply of food, the protective price, the formation of national reserves in order to avoid sharp fall in food prices and hurt farmers. Instead it sold the reserves to stabilize food prices. This regulation, it can be a different year in between the regulation of the remaining places, smoothing fluctuations in grain prices. The long run, it does not fundamentally change the relationship between food supply and demand, if the agricultural years of poor harvests, the result must be no reserves left the country, and ultimately have the grain to the market completely. Conversely, if a good harvest year after year, unless the country's food export surplus, otherwise, it will sooner or later into the market. Even more realistic, the state financial resources are limited, a long time for food to give full protection, the Government has too much. Developed countries, this is the case, the more so in developing countries. Chinese people with special emphasis on food too often discussed from a political point of view, only to emphasize the special nature of the food. Not have enough to eat the past, stressing the indispensable food of course is correct, the political account balance, financial account balance, the results are consistent. This does not mean that food can be better, as a commodity, it also has a general, Also need to consider the equilibrium in the market. In previous years, food production year after year, grain prices are way down, the state prices can not be sold to buy food, make state-owned grain enterprises and the state finance is very difficult. Back to the logic of economics, the market prices is only a signal, always determined by supply and demand by the food. Therefore, the Government let the farmers sell a good grain prices, the fundamental approach, or to be adopted to reduce fallow acreage to ease the contradiction between supply and demand. In fact, regardless of where point of view, the reserves are not as good as the food reserves of arable land, food products are fresh, store a few years, it will degenerate aging; and the reserves of arable land, not only can save a great deal of manpower and material resources, but also beneficial to soil improvement, to improve land productivity. The reason is not complicated at all, the Government may wish to look into the decision-making departments. People's Daily Overseas Edition Author: Wang, Tokyo (Director of the Central Party School of Economics) 2009-6-29