Since the start of agricultural reform in 1978, China has experienced remarkable growth in the field of agriculture. Looking back to 1970, China is one of the poorest and most isolated countries. During that time, there was little private economic activity and millions of people living on a diet of fewer than 2,000 calories per day.
When the government implemented agricultural reform, it played an important role in China’s economic recovery over the past three decades. China was able to restore agricultural production to households, which started building markets and enabled the government to directly control the economy.
These changes increased farmers’ incomes, lifted millions of people out of poverty, and improved the nutritional status of Chinese citizens.
Since then, China has become the largest agricultural economy in the world and is still the leading importer and exporter of agricultural products. However, China’s agricultural sector is still in transition as it responds to increasing and growing demand from domestic and foreign consumers and adapts the smallholder structure to global food markets.
Challenges in agricultural marketing
Traditional China agriculture marketing strategy is highly efficient, flexible, and cost-effective, but this efficiency comes at the expense of incentives for producers or marketing agents to achieve quality and safety. Increasing demand from the growing food processing industry, modern retailers, middle-class consumers, and export markets, as well as the nature of production and marketing, the lack of effective contract enforcement mechanisms, and the low level of farmer organization make it difficult to ensure consistent quality and safety of agricultural products.
Improving food safety is a challenge not only for the government but for China’s marketers as a whole. Investing in better storage, transportation, and cold chain infrastructure that would reduce water consumption from spoilage will allow for greater regional specialization and faster distribution of imported products throughout the country. These are some of the steps the government has taken to address food safety issues.
Another problem is the weak marketing system, which limits the supply of products with special characteristics. Since the Chinese marketing system is unable to segregate higher-quality products, it prevents farmers from producing high-value products and selling them at a higher price.
To combat these problems, China has introduced a complex system of standards and assigned responsibility for food safety to a number of agencies. This is because keeping track of the various standards is confusing for producers and consumers alike. In response, the government has decided that food safety enforcement and monitoring responsibilities will be divided among several government agencies. The Ministry of Agriculture handles support programs to improve the safety of fruits and vegetables, as well as the inspection of fresh produce at wholesale markets. Provincial-level offices of the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) monitor domestic food processors, while the national AQSIQ office is responsible for the safety of all exported (and imported) products. Meanwhile, the Ministry of Health inspects food establishments.
With all these changes China is making with its agricultural reforms, the country has worked its way out of the inefficiencies of planned production and marketing and become one of the longest and most sustained economic growth in world history.
