Without support of state agriculturalsubsidies, agricultural production cannot be well developed. Some changes insubsidy policies have been made in 2016. Some issues should be noted forapplication.
1. “subsidy of agricultural supportingprotection” went into a comprehensive phase
The Ministry ofAgriculture and the Ministry of Finance released “guideline on adjustment ofthree agricultural subsidies” May 2015, and the government decided to integratethree subsidies – “subsidies for superior grain cultivators,” “comprehensivedirect subsidy” and “grain direct subsidy” – into one, called “subsidy ofagricultural supporting protection,” which supports protection of farmlandproductivity and moderate-scale grain operations.
At the beginning ofthe reform, some counties in five provinces were selected for trialimplementation, and the reform spread national wide at the beginning of 2016.
After integration,20% of the total subsidy fund will support moderate-scale grain operations, and80% will support farmland productivity protection. The subsidy addresses allfarmers who have farmland contracting rights. Subsidy of target prices willexpand the subsidy range including soybeans, cotton and three staple foodcrops.
2. Subsidies of agricultural machinery:narrowing range, lowering quota and full payment
Subsidies will befocused on changing developing mode and adjusting construction, and willexclude low-end products, with excess production capacity and low added value. Thesubsidies will reduce the risk of producers and administrative departments.
Subsidy standardsfor the products that have already saturated their market will be reduced.State capital will play a leverage role and reduce excess intervention to themarket, so national efficiency will be improved, with lower risk for producersand administrative departments.
Products within thesubsidy range will be fully paid to the greatest extent; if not, key industryand key machinery will be preferred.
3. Subsidy of comprehensive development: thestatus of independent legal entities is no longer requested
Large-farmhouseholds can apply for subsidy of comprehensive development, and the statusof independent legal entities will not be requested anymore. New agriculturaloperating entities, including large-farm households, family farms and socialservice organizations will be allowed to apply for subsidy with no threshold ofcorporate capacity.
Entities ofapplication are not required to have been profitable in the last two years.Farmers’ cooperatives and leading enterprises that registered more than oneyear ago and have sustainable management capability can apply for theindustrialized operation project. The new policy encourages farmers to obtainequity in the leading enterprises by cooperation. If the farmers hold sharesthey can enjoy dividends.
Agricultural taskssupported by central finance 2016
Agriculturalprotection subsidy
Thereform of the three subsidies supports moderate-scale operation and establishesan agricultural credit guarantee system.
Subsidiesof agricultural machinery
Supportpurchasing of agricultural machinery that is urgently needed for grainproduction, accelerate the mechanization of grain production.
Modernagriculture production development fund
Buildup industrial integration with a centralized fund; develop mechanisms andmethods to increase farmers’ income.
Projectof agriculture technology extension & service
Carryout “corn to soybean” experiments in the northeast, and add utilization oflivestock waste into the experimental activities of agricultural productionsocial services.
Projectof agricultural resources and ecological protection
Carryout subsidy policy of steppe ecology protection and integrated utilization ofstraw; support reform of planting structure in the “camber zone” and theHuang-Huai-Hai area.
Animalepidemic prevention subsidy
Supportcompulsory immunization of animals, important disease culling, safe disposal ofdead animals and funding of grass-roots animal epidemic prevention.
Agricultureproduction disaster relief fund
Supportthe prevention and control of important pests and disease damage, rodent damagein grasslands, construction of fire-barrier belts at the borders of grasslands,and the study of emergency response and rescue for disasters such as floods,typhoons, droughts and snow.
Registrationof rural land contractual management rights
Expandthe experimental unit range of rural land contractual management rights, addingten provinces including Hebei and Shanxi.