Future prospects for agricultural development: The five major trends contain infinite potential!

In the next 30 years, the development prospects of China’s agriculture are mainly reflected in the “five major trends”, including enormous opportunities for agricultural industrialization, agricultural product processing, and the food industry, policy dividends, capitalization opportunities, and deep processing dividends. Mining and utilizing these five gold mines effectively captures the future of agriculture.As early as the end of the 20th century, Qian Xuesen, a famous scientist, once said in his proposal on China’s agricultural development: “On the basis of China’s small-scale peasant economy, it is impossible to spontaneously move towards agricultural industrialization; the fundamental driving force of China’s agricultural modernization lies in scientific and technological innovation, the process of industrialization, and the modernization process of the whole country.” Time has passed, and today’s agriculture has moved forward in the process of modernization. Looking ahead to the prospects of agriculture, countless people predict that agriculture will be a blue ocean of ten trillion yuan. So, what areas are the opportunities for agriculture focused on?01Industrialization Helps Agriculture Achieve Triple JumpWithout industrialization of agriculture, everything is in vain! In fact, agricultural industrialization can be achieved through three-level leaps.01. Changing production methodsAfter the industrialization of agriculture, the mode of agricultural production and management will be forced to change, which brings huge strategic opportunities. Agriculture will design products according to the market, develop markets based on user needs, and undergo reforms in the standardization of production and modernization of management.02. Increase marketing channels for agricultural productsThere is only one path for current agricultural products: from fields to dining tables. Although the “agriculture+internet” approach has helped the market eliminate intermediaries and helped establish mutual communication between agricultural products and citizens. However, the channels are still single. After the consumption upgrade, consumers’ expectations for agricultural products have become higher, including taste, packaging, brand, etc. Therefore, these things can be completed and realized by the processing industry.03. Complete transformation of agricultural productsAfter the industrialization of agricultural products, they have become new forms of products such as food, handicrafts, and gifts. At the same time, industrialization will give agricultural products imagination space and market opportunities. Therefore, the key task of agricultural operators is not only to produce high-quality agricultural products, but also to satisfy consumers’ imagination of agricultural products and bring about revolutionary changes in agricultural products.2.png02Huge potential in the food industryAs an important component of large-scale agriculture or agricultural deep processing, the four major food industries have enormous potential!01. Leisure foodAccording to the “2016-2020 Development Opportunities Report of the Leisure Food Industry” by the China Academy of Commerce and Industry, the total sales revenue of China’s leisure food market in 2015 was 522.5 billion yuan, with a compound annual growth rate of 9.3% from 2011 to 2015. In 2015, the total sales of candy accounted for the largest share of China’s leisure food market at 24.5%, with pastries ranking second at 17.2% and nuts ranking third at 13.5%. With the development of the Chinese economy, the market demand for leisure food will continue to grow, with a predicted compound annual growth rate of 10.3% from 2016 to 2017. In 2017, the market size of leisure food will reach 634.2 billion yuan.02. Healthy and nutritious foodWith the upgrading of consumption, consumers are paying more and more attention to healthy food. At present, the market size of healthy and nutritious food in China is about 80 billion yuan, and in three years, this figure may exceed 180 billion yuan. At the same time, the potential of China’s healthy and nutritious food market is enormous, and food companies urgently need to make efforts in the field of healthy and nutritious food.03. Imported FoodAccording to the prediction of the American Food Industry Association, the sales of imported food in China will grow at a high speed of 15% every year. By 2018, China will become the largest consumer of imported food in the world. At that time, the market size of imported food in Chinese Mainland will reach 480 billion yuan, which will drive an investment boom in the imported food industry.04. Organic FoodIt is predicted that by 2025, the global organic food and beverage market is expected to reach $320.5 billion, much higher than the $77.4 billion in 2015; The revenue of China’s organic fruit and vegetable market is expected to exceed 110 billion US dollars, which will dominate the global organic food market.3.png03Scaling of agricultural product processingIn December 2016, the General Office of the State Council issued the “Opinions on Further Promoting the Development of Agricultural Product Processing Industry”, which made a comprehensive deployment for the development of China’s agricultural product processing industry in the coming period. The Opinion proposes to strengthen financial support and support eligible processing enterprises in applying for relevant agricultural support funds and projects. Improve tax policies, expand the scope of pilot industries for the verification and deduction of input value-added tax on agricultural products, and implement preferential policies for income tax of agricultural product initial processing enterprises. The acceleration of the implementation of the “Opinions” at the national level is based on the following two aspects:01. The income of agricultural product processing enterprises above designated size has reached 20 trillion yuanChina’s agricultural product processing industry has made significant progress. By 2016, the main business income of agricultural product processing enterprises above designated size reached 20.1 trillion yuan, accounting for 19.6% of the manufacturing industry. It has become a basic industry with wide industry coverage, high industry correlation, many small and medium-sized enterprises, and strong role in driving farmers’ employment and income.From the perspective of weight analysis, the goals of “2020 agricultural product processing conversion rate of 68% and 2025 75%” fully consider factors such as policy driven, market driven, technology driven, and rural industry integration driven in the development of agricultural product processing industry.The Opinion proposes a series of policy measures to address these issues. In terms of financial support and tax policies, it is required that relevant agricultural support funds and agricultural comprehensive development funds should support agricultural product processing industry projects, and various regions should support the construction of public facilities for agricultural product processing industry. Expand the scope of pilot industries for the verification and deduction of input VAT on agricultural products, adjust, improve, and clarify the scope of preferential treatment for initial processing.02. In 2020, the output value of agricultural product processing industry will be twice that of agricultureThe Opinion proposes that by 2020, the ratio of agricultural product processing industry to total agricultural output value will reach 2.4:1, and the conversion rate of agricultural product processing will reach 68%; By 2025, the conversion rate of agricultural product processing will further increase, reaching 75%. That is to say, by 2020, the output value of agricultural product processing industry will be twice that of agriculture.With the upgrading of urban and rural residents’ consumption in China, there is a strong demand for processed products. It is estimated that the agricultural product processing industry will maintain an average annual growth rate of no less than 6.5% in the next five years. If calculated based on the average annual growth rate of 4.0% of the total agricultural output value in the next five years, the ratio of agricultural product processing industry to total agricultural output value is expected to reach 2.4:1 by 2020.At the same time, it should also be noted that the comprehensive processing and transformation of major agricultural products will be rapidly released in the process of agricultural modernization and rural urbanization. It is expected that the processing and transformation rates of grains, vegetables, fruits, and meat will increase to 88%, 13%, 23%, and 17% respectively by 2020, and to 90%, 30%, 35%, and 45% by 2025.4.jpg04Policy dividend becomes a key breakthrough pointIn recent years, “the publication and promulgation of both the No. 1 central document and the Opinions reflect the importance the country attaches to the issues of agriculture, rural areas and farmers.” Agricultural enterprises and agricultural product processing industry have become beneficiaries of dividends. According to incomplete statistics, as of now, there are a total of 45 agricultural listed companies in China. Among them, 17 listed companies are agricultural product processing enterprises, accounting for 37.78%.01. Financial policy support to help agricultural product processing enterprises overcome financing difficultiesIn the view of Chen Zezhou, a researcher at Zhongyan Puhua, the government’s proposed financing policies for agricultural product processing enterprises mainly focus on strengthening financial services, increasing credit support, expanding guarantee business scale, and innovating the “credit+insurance” industry chain finance. At the same time, it also manifests in improving investment and trade conditions, supporting social capital to engage in fields such as agricultural product processing and circulation.In the view of Song Qinghui, a famous economist, the No. 1 central document and the Opinions are of great significance in supporting the listing and financing of agricultural product processing enterprises. Song Qinghui stated that the implementation of these policies is not only conducive to accelerating the listing and financing of agricultural product processing enterprises, but also an important symbol of modern agriculture.02. The government becomes the main driving force for agricultural product processingIn the “Implementation Opinions on Further Promoting the Development of Agricultural Product Processing Industry” released by the Shanxi Provincial Government on June 29, 2017, it was clearly stated that by 2025, the conversion rate of agricultural product processing will reach 70%, and support the development of primary processing of agricultural products, vigorously develop functional foods and healthy foods, accelerate the development of staple food processing industry, develop comprehensive utilization of agricultural product processing by-products, and promote deep integration of agricultural product processing industry with other industries, Promote cluster agglomeration development. This “Opinion” is another important document formulated at the provincial level in Shanxi Province after eight years, specifically targeting the development of agricultural product processing industry, and has milestone significance.At the same time, since 2016, Changchun City has continuously increased policy support for key leading enterprises, established a long-term service mechanism, and provided key support to enterprises from equipment updates, independent research and development, loan guarantees, and brand creation. It has also continuously expanded the group of agricultural industrialization leading enterprises, expanded the number and scale of national, provincial, and municipal leading enterprises, and accelerated the formation of advantageous industrial clusters. Jilin Changchun’s agricultural product processing industry has achieved an output value of 208 billion yuan, and has established a processing system for agricultural products such as corn, rice, soybeans, pigs, beef cattle, broilers, geese, rabbits, and deer. In 2017, the output value of the agricultural product processing industry in Changchun City is planned to reach 225 billion yuan, with a growth rate of over 8%. This indicates that Changchun is making great strides towards becoming a world-class agricultural product processing base, and the agricultural product processing industry has become the second largest pillar industry in Changchun after the automotive industry.5.jpg05Deep processing dividends that cannot be ignored01. From shallow processing to deep processingData shows that as of December 2016, there were 81000 agricultural product processing enterprises above designated size in China, with main business revenue reaching 20 trillion yuan and a total profit of 1.3 trillion yuan. But one thing is that primary processing of agricultural products is already difficult to leverage market demand. This means that deep processing of agricultural products will usher in spring. The Opinions of the State Council also address these issues, encouraging the development of primary processing that does not change the inherent quality of agricultural products, the development of deep processing for secondary or higher processing, the development of staple food processing, and the development of comprehensive utilization processing.02. Deeply Dig into Rural LogisticsProcessing and logistics transportation are inseparable. Agricultural product processing is an internal skill, while logistics is an external skill of agricultural products. The agricultural product processing market with a scale of tens or hundreds of billions needs to be driven by logistics. At the same time, rural logistics includes the construction of transportation, talent, cold chain, warehouses, and other industries, all of which hide huge wealth.03. Reinventing the InternetThe internet is a good booster for agricultural product processing, which relies on internet fission channels to subvert traditional marketing channels. The Internet has three major applications in the agricultural product processing industry: 1. Traceability system: an agricultural product traceability system built with the help of the Internet to improve the safety of agricultural products; 2. Technological upgrading: In the agricultural production stage, internet technology is used to improve the efficiency of planting and breeding, thereby winning the initiative in cost; 3. In terms of channels: E-commerce, WeChat, and new retail are all new marketing channels created by agricultural products through the Internet.