1、1Shandong Rural Co-ops Help Ag Sector GrowChinas fragmented farm sector， characterized by tiny family plots and a declining number of farmers， has long resisted modernization. However， at least in Shandong province， a once-lumbering rural co-op is reinventing itself trying to help farmers increase y
2、ields and incomes in what historically has been a highly inefficient agricultural sector. Small farms confront problems China is a nation of micro-farms. In Shandong， farmers on average own only 2 mus （0.13 hectare） of farmland， according to the Ministry of Agriculture. In 2013， 86 percent of Chines
3、e rural families operated on less than 10 mus （0.67 hectare） of land. At the same time， the countrys rural labor force has been shrinking as more young people head to cities for higher-paying jobs. Nearly 60 percent of Shandongs farm labor force has migrated to cities， leaving mainly the elderly to
4、work on the land， said Xiao Xizhang， director of the cooperation supervision office of the Shandong Supply and Marketing Cooperative（Shandong SMC）. Xiao said that more than 20 2percent of villages in Shandong have seen more than 70 percent of their labor force leave， often for construction or restau
5、rant jobs in neighboring cities. Meanwhile， not only are many farmers too old to work their own land， but the income from their small farms has never been enough to buy modern equipment. Co-op begins offering solutions Back in 2010， Xu Feng， director of the Wenshang county rural Service and Marketin
6、g Cooperative in Jining， took the first step to address some of the issues besetting farmers. The co-op began by offering machinery harvesting services to local farmers for a small fee. Since then， hundreds of such organizations have cropped up throughout Shandong， and the range of services they pro
7、vide has expanded. Over in Kangzhuang township in southwest Gaomi， an agricultural county in eastern Shandong， mechanical harvesting of mostly corn and wheat was recently completed on over 800 hectares of farmland in seven days. Huge barns and grain dryers have been installed in the courtyard of the
8、 Kangzhuang service center， with tractors and other equipment parked outside. The center also has built labs for testing soil and making fertilizer. 3The local SMCs and agricultural service centers can offer other services that are more efficiently done on a larger scale， such as getting better pric
9、es by buying seeds in bulk， plus spraying for pests， storing grain and selling crops. Yue Mengxi， whose farm operates over 65 hectares of land in Gaomi， said that with help from the agricultural service centers large harvesters and other machines， her farm now needs a muchsmaller labor force， which
10、has reduced production costs by 200 yuan per mu， or 3，000 yuan per hectare. Even after purchasing services from the local coop less than 150 yuan per mu her profits have increased. Some farmers have fully entrusted their land to service centers for about 150 yuan a year per mu， and then leave for jo
11、bs in city. According to the Shangdong SMC， farmers have seen grain production rise 20 to 30 percent after being managed by service centers. “There is great potential for developing large-scale services， ” said Liu Shouying， an agricultural policy expert at Renming University. To be sure， these supp
12、ly and marketing co-ops dont solve all of Chinas farm problems. For one thing， even when the co-ops take over all the management of farms， they provide 4little in the way of infrastructure investment such as irrigation systems and land consolidation， said Yang Bingping， deputy director of the agricu
13、ltural and industrial affairs office of the Shandong government. The program works best when the farms are already in good condition， he said. Also， mountainous regions， where getting from one small farm to another can be difficult， pose a whole new set of problems. Another limitation in Shandong is
14、 that agriculture service centers focus on large family farms， ag companies and land cooperative set up by villages. The centers dont accept land directly from individual farmers. Instead， small farmers need to gather their land together to form land cooperatives with help of local co-op and village
15、 authorities and then entrust the land as a package to the service center. Transformation gains steam About three years after the Wenshang county SMC started offering machinery harvesting services to local farmers， it opened its first agricultural service center. In 2013， it gathered 4 million yuan（
16、US$ 600，000） in investments from several local SMCs and expanded from harvesting to fertilizing， pest control， grain marketing and 5other services. By the end of that year， Shandongs SMC system earned 160 million yuan net income by offering agricultural services to farmers. Figures werent available
17、for net income for 2012， but revenue increased to 5.8 billion yuan in 2013， up from 5.4 billion yuan in 2012. By August， Shangdong rural SMCs had set up 750 agricultural service centers across the province to manage 1.1 million hectares of land for farmers， about 20 percent of the provinces total fa
18、rmland， according to the Shandong SMC. The goal is 1， 500 agricultural service centers by 2020 to manage more than 1.3 million hectares. Service centers gain farmerstrust Beijing in recent years has encouraged rural residents， especially those who have left rural areas， to sell their land-use rights
19、 to others. Rural land in China is under collective ownership， and farmers control only the land-use right. But such pilot programs have had only limited success， as many farmers are reluctant to give up their land rights. Yang Bingping， deputy director of the agricultural and industrial affairs off
20、ice of the Shandong government， said that entrusting service centers that manage farmers land offers an 6alternative way to keep their land thriving. As a result， while some farmers pay service fees for the SMCs to help with seeds， harvesting selling and other chores， others fully entrust their land
21、 to service centers and then leave for jobs in cities. Kangzhuang and other 14 similar agricultural service centers in Gaomi have been entrusted by local farmers to cultivate 30 percent of the citys 86，600 hectares of farmland. Farmers can earn more from grain sales after entrusting their land to lo
22、cal service centers for farming compared to simply selling the land rights， even after paying the centers service fee， said Yu Qingfeng， deputy director of the Shandong SMC. “When farmers leave for jobs， we take care of their land，“ he said. SMC system expected to expand By offering large-scale farm
23、ing services， SMCs service centers offer a way to realize massive， modernized agricultural production on land that previously was overseen by hundreds of scattered family farmers， said Chen Xiwen， former deputy director of the Rural Affairs Leading Group， a top party decision-making body in Beijing.
24、 7Some scholars expect the stronger SMC system to player a larger role in Chinas rural community， expanding from agricultural production to other aspects of rural life. “Ive seen some promising signs in Shandong. It is possible to develop a comprehensive network to offer lifelong services to farmers
25、 under the SMC system，“ said Xu Xianglin， deputy director of the rural research center of the Party School of the Communist Partys central committee. He expects the SMCs to grow into a network that links different services for rural residents from production to everyday life. Yu， deputy director of
26、the Shandong SMC， said it has already started to offer financial， logistics and some community services such as elderly care and education services to rural residents. However， an employee of the Shandong SMC said that more challenges are expected as SMCs expand further into rural life due to the complex land ownership in rural China and entangled interests among different parties. For SMCs to play a greater role in Chinas rural reform efforts， more policy support and better coordination among agricultural departments will be needed， the employee said.
