China's economic planning chief told an annual development and
reform meeting at the weekend that decreasing grain prices coupled
with growing costs of production mean farmers are unlikely to see a
significant rise in income next year.
Ma Kai, director of the National Development and Reform
expressed his concern as the government is increasing funds to
improve rural people's lives by enhancing rural infrastructure
Grain prices have been dropping since April and prices of wheat,
corn and rice from August to October fell 5 percent compared to the
same period last year, said Ma. Meanwhile, prices of production
materials such as fertilizer and diesel have risen 9.1 percent year
on year in the first 10 months.
Vice Minister of Agriculture Yin Chengjie said large-scale
culling of poultry due to outbreaks of bird flu and the impact of
China's entry to the WTO also posed hurdles for increasing the
incomes of the country's 780 million farmers.
According to China Daily today, farmers' income is
expected to increase by 5 percent this year, meeting the target set
by central government at the beginning of the year.
Last year, farmers' per capita net income reached 2,936 yuan
(US$362), up 6.8 percent year on year and the highest increase
Ma said the government would continue to seek fast, steady
economic growth in 2006 but that more effort will be made to
address challenges caused by overheating in some industrial
Of oversupply in the steel, coke and auto sectors he warned: "If
we don't effectively address the problem immediately, a large
number of companies will go bankrupt and many people will lose
(China Daily December 5, 2005)