The central government has allocated 10 billion yuan to support spring farming—“a 10-billion-yuan subsidy” for grain farmers.

　In April this year, the central government allocated 10 billion yuan in subsidies to provide a one-time payment to farmers who actually grow grain, thereby supporting spring‑time farming. As May began, these grain‑production subsidies were gradually disbursed, with many localities releasing schedules for when payments would be credited. Major grain-producing provinces such as Heilongjiang and Henan have specified that the subsidies will be delivered to eligible farmers within May.

Since 2021, the central government has disbursed a total of 70 billion yuan in one-time subsidies to farmers who actually grow grain, with 20 billion yuan in 2021 and 40 billion yuan in 2022. Why are these one-time subsidies being provided to grain farmers? And how effective have these “ten-billion-yuan subsidies” been?

Supporting farmers in coping with rising agricultural input prices

The primary reason for rolling out the “Ten-Billion-Yuan Subsidy” is to counter rising agricultural input prices.

Fertilizers, pesticides, fuel, and other agricultural inputs are often referred to as “the grain of grain.” During peak fertilizer‑use periods such as spring plowing and preparation, prices for these inputs tend to fluctuate, placing cost pressures on grain farmers. On the revenue side, since April this year, a confluence of factors—including policy‑driven grain auctions, rising import volumes, increased shipments by traders, and weak market demand—has pushed down prices for rice, wheat, corn, soybeans, and other staple grains.

Rising costs and declining returns make it easy for grain farmers to lose confidence. In interviews, several farmers told us that grain prices and agricultural input costs are the two most critical factors determining profitability and expenses. However, in recent years, driven by soaring fertilizer‑raw‑material prices and the COVID‑19 pandemic, input costs have often outpaced grain prices—“grain gets more expensive by one cent, but fertilizer by three”—which has, to some extent, dampened farmers’ enthusiasm for growing crops.

As the ones bearing the brunt of rising agricultural input costs, grain farmers urgently need timely support during critical stages of production to ease financial pressures and enable them to focus on farming with confidence.

To this end, the state has taken into account both market trends in agricultural input prices and the overall situation of agricultural production, and the central government has allocated a one-time subsidy of 10 billion yuan to farmers who actually grow grain, in order to stabilize their incomes and safeguard their enthusiasm for grain production.

“Ten-billion-yuan subsidies” are not a first. According to reports, in June 2021, during a critical period for autumn grain production, the central government allocated a one-time subsidy of 20 billion yuan to farmers actually engaged in grain cultivation, aiming to offset the additional costs resulting from rising agricultural input prices. In 2022, similar one-time subsidies were disbursed in three installments—in March, May, and August—providing robust financial support to grain producers at key stages: spring plowing preparations, summer grain harvest, and autumn harvest and sowing. Adding this year’s 10 billion yuan allocated during the spring planting season, the central government has now cumulatively disbursed a total of 70 billion yuan in one-time subsidies to farmers actually growing grain.

How have the recent rounds of “10-billion-yuan subsidies” performed? Lao Yang, a rice‑farming contractor in Shou County, Anhui Province, explained that in 2022, the central government disbursed one‑off subsidies to farmers actually engaged in grain production in three installments. “For my household, the first installment amounted to just over 800 yuan, while the subsequent two were each close to 400 yuan.” Lao Yang cultivates roughly 60 mu of double‑cropping rice and, during both the spring and autumn seasons, must purchase fixed quantities of fertilizer for seedling raising and germination. “The subsidies essentially cover our fertilizer costs. Without these three rounds of assistance, we would have lost the entire amount spent on compound fertilizer.”

According to reports, provinces including Henan, Heilongjiang, and Inner Mongolia have already announced the disbursement of one-time subsidies to farmers who actually grow grain. In addition, the central government recently allocated the first batch of disaster prevention and relief funds for agricultural production, totaling 1.251 billion yuan, to support provinces such as Heilongjiang and Shandong in procuring pesticides, equipment, and other supplies needed for controlling major pests and diseases affecting grain crops. Furthermore, 1.6 billion yuan in subsidy funds has been disbursed to assist 22 wheat-producing provinces, including Hebei and Anhui, in carrying out “one spray, three protections” operations during critical stages of wheat yield formation. Experts note that these funds will further boost farmers’ enthusiasm for grain production, encourage them to plant more and cultivate higher‑quality crops, effectively increase grain output, and help ensure the successful completion of the year’s grain production targets.

Both accurate and fast, ensuring that grain farmers reap the benefits in a timely manner.

To ensure that farmers who actually grow grain benefit, the disbursement of funds must first prioritize precision, guaranteeing that agricultural support policies are implemented without compromise or distortion.

How should “actual grain‑producing farmers” be defined? This requires clearly delineating the eligibility criteria and accurately identifying those who are truly engaged in grain production, while ensuring thorough verification of the subsidized acreage.

The Ministry of Finance has clarified that the subsidy is intended for actual grain producers who bear the cost increases associated with rising agricultural input prices. This includes farmers cultivating their own contracted land, large-scale operators, family farms, farmer cooperatives, agricultural enterprises, and other new types of agricultural business entities that lease land for grain production, as well as individuals and organizations providing comprehensive, socially‑oriented services covering the entire process of grain cultivation, harvesting, and related activities. The aim is to ensure that subsidy funds are delivered directly to the producers who are actually engaged in grain farming. Furthermore, during the identification and verification processes, existing data—such as baseline records for subsidy disbursement, insurance underwriting data for grain crops, and identity information on farm households and new agricultural business entities—can serve as valuable references.

How are subsidy standards determined? The Ministry of Finance has clarified that subsidy standards are to be set by each region based on a comprehensive assessment of relevant circumstances, and in principle, subsidy rates should be uniform within each county.

In practice, local authorities typically calculate subsidy rates by dividing the total allocated funds by the eligible acreage; in some provinces, these rates vary across counties. Taking the 2022 subsidy disbursements as an example, a review of relevant provincial documents reveals the following: In Yunnan, the third tranche of subsidies sets the rice‑planting rate at 13.22 yuan per mu and the rates for other autumn‑harvest crops—such as corn, potatoes, and soybeans—at 8.83 yuan per mu; in Beijing, grain crops including wheat, corn, and millet receive payments based on the year’s sown area at a rate of 10 yuan per mu, with agricultural districts authorized to specify detailed eligibility criteria tailored to local conditions; and some provinces have established upper and lower limits—for instance, Guangxi caps the per‑mu subsidy at 200 yuan, while Shandong mandates a minimum of 25 yuan per mu.

Farmers need subsidy funds to purchase agricultural inputs and organize production, ensuring that farming schedules are not missed; disbursement of these funds must prioritize speed.

Modern information technology offers effective solutions. Reporters learned that, in the process of disbursing funds, local authorities leverage existing databases on relevant subsidy programs and employ methods such as the “one card (or passbook) for all” system to ensure timely and full delivery of subsidy payments. In some areas, various subsidies benefiting both urban residents and farmers are consolidated and distributed through social security cards, bank accounts opened at designated disbursement banks, or passbooks, offering multiple advantages: centralized disbursement is more convenient, recipients can collect funds without leaving home, and the process is open, transparent, and fully traceable.

In addition to being fast and accurate, the actual disbursement of funds must be subject to rigorous oversight and management to ensure that funds are delivered directly to the intended recipients.

In Jining City, Shandong Province, staff from the Discipline Inspection and Supervision Commission of Wenshang County have focused on critical milestones in fund disbursement, adopting a “bottom-up” oversight approach that takes them directly to the fields to ensure that funds are transferred to farmers as quickly as possible. “Now, higher-level agricultural input subsidies are being disbursed more promptly—credited to farmers’ ‘one-card’ accounts at the fastest possible speed. With subsidies arriving so swiftly, I can stock up when fertilizer prices are low, taking advantage of market conditions and saving a considerable amount of money,” said Li Jiyin, a large-scale grain farmer in Wenshang County.

Strengthening the Safety Net for Agricultural Subsidies

Fiscal support for agricultural production remains robust, with various farmer‑benefiting subsidy programs working in tandem with agricultural insurance and minimum purchase price policies to deliver a comprehensive package of measures aimed at boosting farmers’ incomes.

In a rice paddy practicing “rice–fish co-culture” in Jishigang Town, Haishu District, Ningbo City, Zhejiang Province, rice transplanters shuttle back and forth, while drones hover overhead, scattering shrimp feed. Drones, rice transplanters, furrow‑making machines, dryers, self‑propelled tracked combine harvesters—large-scale grain farmer Dai Guofang lists these machines with great familiarity: “From 2021 to the present, the central government has provided me with 710,000 yuan in subsidies for purchasing agricultural machinery alone.”

Dai Guofang stated that agricultural subsidies are disbursed through digital technologies, enabling farmers to “purchase machinery independently, receive fixed‑amount subsidies, claim reimbursement after purchase, settle at the county level, and have subsidies directly credited to their bank accounts,” thereby encouraging local farmers to boldly embrace mechanized farming.

Agricultural input subsidies, subsidies for the purchase and use of agricultural machinery, subsidies for protecting farmland fertility, producer subsidies for corn and soybeans, rice subsidies—these measures have woven a “safety net” to stabilize the incomes of grain farmers. Data show that in 2022, the central government allocated over 350 billion yuan in subsidies for grain production. This year, China will further increase investment in agriculture and strengthen subsidy programs, boosting the “two sources of motivation”—farmers’ enthusiasm for growing grain and the vitality of major grain-producing regions.

The central government takes the lead, with local authorities following suit, bolstering confidence in boosting grain production. Building on the implementation of central policies that benefit farmers, provinces are also refining the structure of provincial fiscal expenditures, directing more resources toward key areas of agricultural production.

This year, Fujian’s provincial finance will support the development of grain and oilseed production to achieve the annual targets: “12.53 million mu of grain‑sown area (including 528,000 mu of soybeans), a total grain output of 5.07 million tons, and 120,000 mu of oilseed‑sown area.” The province is promoting large‑scale grain cultivation by providing a one‑time reward of 200 yuan per mu to entities that lease and operate 100 mu or more of farmland for a period of at least three years in designated capacity‑building counties. It is also supporting double‑cropping rice production: for operators who cultivate early rice on a scale of 30 mu or more and follow it with late rice, a subsidy of up to 200 yuan per mu will be granted based on the actual area planted with early rice. Furthermore, the province encourages socialized services for grain and oilseed production, offering subsidies for activities such as contract tillage, planting, pest control, harvesting, and drying, with a maximum subsidy of 130 yuan per mu per season.

Can the policy of agricultural subsidies be institutionalized as a long-term mechanism? Some experts suggest drawing on the price‑subsidy model to refine the agricultural input subsidy policy, shifting from one‑off payments to a linked subsidy system indexed to prices.

Jiang Wenlai, a researcher at the Institute of Agricultural Resources and Regional Planning of the Chinese Academy of Agricultural Sciences, stated that it is necessary to establish scientifically sound subsidy standards, set a cap on subsidies for rising agricultural input prices, and create a dedicated fund pool for agricultural input subsidies. A long-term mechanism should be put in place, triggered when the increase in agricultural input prices reaches a certain threshold, thereby reassuring farmers and strengthening the safety net, thus contributing to food security in a comprehensive manner. (Reporter: Wang Wenzheng)

[Editor-in-charge: Liu Yang]

Source: People’s Daily Overseas Edition