Economy

Government acts to relieve pressure on farmers

By Zhou Siyu (China Daily)
Updated: 2011-04-28 11:14

The Ministry of Commerce urges commercial departments at all-level governmens nationwide to improve transportation links between farmers and supermarkets. [Photo / China Daily]

BEIJING - The Ministry of Commerce has stepped up its efforts to prevent a slump in vegetable prices from hurting farmers.

On Wednesday, the ministry arranged for 12 major supermarkets in Beijing, including Wumart Holdings Inc, and international retailers such as Wal-Mart Stores Inc and Carrefour SA, to sign a proposal to help boost vegetable sales.

It's the latest move aimed at tackling the falling price of vegetables, after the ministry issued two measures within recent weeks.

Related readings:  China's vegetable, egg prices drop: ministry  Rites of spring  Mainland foods feed Hong Kong's appetite  Fight inflation hard

"Commercial departments at all-level governments nationwide are urged to improve transportation links between farmers and supermarkets," said Wang Bingnan, director of the department of market operation regulation with the ministry.

According to the proposal, supermarkets will set up temporary vegetable stalls to promote sales by speeding up delivery times to supermarkets and reducing transportation costs.

Fu Yu, assistant to the president of Wumart, said the supermarket's daily purchase of vegetables has increased by 90 tons to 260 tons on working days and 450 tons at weekends.

"We keep the vegetables at a low price and as they are the staple vegetables for the Chinese people, we sell out," Fu said.

In the supermarket, large promotion cards show the prices of the vegetables suffering most from the recent slump.

"Vegetable prices in the supermarkets are lower than in the street market," said Zhang Xiaohong, a Beijing resident. She was picking up cabbages from a temporary stall and putting them into her trolley, which was already fully laden with fresh vegetables.

Ma Wenfeng, a senior analyst at Beijing Orient Agribusiness Consultant Ltd, one of the major consultancies in the country's agriculture sector, said the ministry's move will benefit both consumers and farmers.

"To enable supermarkets to buy directly from farmers will greatly reduce transportation costs and vegetable prices for urban consumers," Ma said.

"The government should strive to establish a long-term mechanism to remove the middleman and allow farmers and supermarkets to work together," he added.

The steep decline in vegetable prices has resulted in farmers crushing their vegetables in the fields, for use as organic fertilizer, or setting them aside for animal feed, as they prepare to plant different crops.

Government concern over the price slump was heightened when Han Jin, a 39-year-old farmer in Jinan, the capital of Shandong province, committed suicide when faced by heavy losses.

Experts and analysts said the price slump has been mainly caused by increases in production, over-concentration on some vegetables, and unseasonably warm weather.