I'm still exploring who will benefit from all these subsidies eg. seeds companies, fertilizers, farm equipments, retailers, cement, building materials etc..
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China Gives `Unprecedented' Support to Farming, Minister Says
By William Bi
May 8 (Bloomberg) -- China, the world's fastest-growing major economy, is giving more support than ever to farmers to stem declining interest in agriculture and meet rising food demand, the government said.
``Unprecedented'' emphasis is being placed on farming, Minister of Agriculture Sun Zhengcai said in a question-and- answer statement posted on a government Web site. Financial and policy support, coupled with progress in technology, will help the country of 1.3 billion people to feed itself, Sun added.
China's demand for food, boosted by urbanization and higher incomes, contributed to record gains in agricultural commodities this year. Increased domestic production may boost stockpiles of grain and reduce import needs, while helping to ease inflation that reached an 11-year high in February.
``Agricultural infrastructure is still fragile,'' Sun said in the statement dated yesterday. It's becoming increasingly difficult to achieve self-sufficiency in grains and other products, he added.
China has 226 million registered rural residents working in urban centers, buying food instead of growing it, the minister said. In the past 10 years, city dwellers' food spending rose 80 percent, stoking demand for meat and feed grains, he said.
Damage from natural disasters, higher farming costs, declining profits and lack of transport capacity for grain are some of the immediate concerns, Sun said.
Rising Consumption
In the long run, consumption of grain will rise because of increased demand for food, animal feed and industrial usage, as well as population growth, Sun said. China had a net gain of 90 million people in the past 10 years, he said.
Crop output is restricted by availability of land and water, slower gains in yields and low returns on farming, Sun said.
Spending to support agriculture this year gained 85 percent from a year ago to 95 billion yuan ($13.6 billion), Sun said. Grain output can stabilize at 500 million metric tons, he added.
While the world faces a possible food crisis, China has seen only ``reasonable'' gains in agricultural product prices, Sun said. Food stockpiles are twice the world average, and include about 40 million to 50 million tons of rice, he said.
``We have food in our hands, so no stress in our hearts.''