A Study On The Pricing Of Rice In China

Rice is the first major grain crops, which play a dominant role in grain production and consumption. The development of China's rice industry have a decisive function in food security in china and world. However, a series problems have perplexed the development of China's rice industry including periodic fluctuations in production, a large number of rice producers have engaged in the other agricultural or non-agricultural from growing rice, the age structure of rice producers is increasingly older.These problems reflect that the benefit of rice production is low and productive enthusiasm is decreased, and the most important factor is the unreasonable purchasing price of rice, what level The purchasing price is reasonable, which can make rice producers and rice dealers satisfaction, study of this issue have great significance in coordinated development of rice industry and food security of china.The main contentsTo complete the research target of this paper, The contents include the following seven aspects:1. Research on the rice supply and demand and judgment on the Tendency. On the rice production side, this paper has analyzed the regional distribution, yield and it's regional difference, production and it's trend. On the rice import side, this paper has analyzed import amount and variety structure, import resources and quantitative distribution, import quantity and trend. On the rice domestic demand side, this paper has analyzed use structure, variety structure, demand quantity and trend. On the rice stock side, this paper has analyzed subject distribution, variety structure, stock quantity and trend. And the paper has judged the status and future trends of the rice supply-demand relationship.2. Research on the price classification system, the relationship of price parities and price difference. This paper has analyzed the characteristics and the relationship of policy price and market price, purchasing price, wholesale price and retail price, spot price and futures price, domestic price and international price, studyed the price parities relationship between rice and means of production, other grain crops, economic crops, milled rice and studyed the difference of purchasing price and wholesale price, wholesale price and retail price, regional price differences, seasonal price differences, species price differences and quality price differences.3. Research on the effect of purchasing price on the rice production and consumption. In theory, this paper has analyzed the effect of purchasing price on the area planted, yield, income of rice producers, rice consumers, rice processing enterprises, poultry and livestock farmers, and the rice supply and demand changes. In empirical, this paper has quantitativly analyzed the effect of purchasing price on area planted, yield, total supply, supply structure, total consumption and consumption structure by building regression model. 4. Research on the formation mechanism and fluctuation reasons of rice purchasing price. This paper has theoretically analyzed the basis of the formation and fluctuations, external environment and internal mechanism. And it has analyzed the effect direction and intensity form material goods cost, labor cost, land cost, supply-demand relationship and international rice prices playing on rice purchasing price by building logarithm model.5. Research on the rice pricing under the market equilibrium. This paper has built the analytical framework of purchasing price formation and determination based on the Perfectly Competitive Equilibrium Displacement Model built by Gardner and the Imperfect Competitive Equilibrium Displacement Model built by McCorriston and Weldegebriel and built the pricing model of rice in equilibrium based on the Bargaining Model to research on on the rice pricing under the market equilibrium. It has analyzed the effects form bargaining power of rice producers and production costs playing on the price asked by rice producers, form bargaining power of rice dealers, retail price and distribution cost playing on the price bided by rice dealers, form all factors playing on the purchasing price. Under the market equilibrium, the basic picing model represented asPe and Pr denote purchasing price and retail price of unit rice, ACs and ACd denote production cost and distribution cost of unit rice,φandψdenote denote bargaining power of rice producers and dealers,λdenotes contribution coefficient of rice producers contributed to the value of rice,1-λdenotes contribution coefficient of rice dealers contributed to the value of rice, v denotes trade surplus (v=Pr-ACs-ACd)。6. Research on the rice pricing under the changing condition. This paper has built the pricing model with price of production inputs or retail price of rice being changing and all factors being changing together based on the basic pricing model and analyzed how to price under the changing condition by using the comprehensive pricing model.7.Empirical research on the rice pricing. This paper has verified the pricing model by the actual data delivered in Hubei, Hunan and Chongqing, calculated the purchasing price ranges with complete-cost and incomplete-cost in different terrain areas and judged the rationality of purchasing price of rice.The main conclusionsWith theoretical analysis and empirical study, the conclusions include the following four aspects:1.The characteristics of supply and demand of rice in china are overall balance, Long-term tight and serious contradiction in variety structure. With the view of the present situation in rice supply and demand, since the mid-1960s, the supply and demand is balance in quantity, but the supply and demand is unbalance in structure of inter-regional and inter-varieties, it is mainly presented as a big inventory pressure in producing areas, a big demand gap in sales areas, the supply exceeds demand in hsien rice and the demand exceeds supply in japonica rice. With the view of the trend in rice supply and demand, it is more and more difficult to increase supply of rice with the acreage reduction, water scarcity, industrial pollution, but the demand of the high-quality rice is growing with the population growth and improvement of living standards. So the demand exceeds supply of rice is an inevitable trend in a long term.2. Severe low rice price in China, which leads to the low productive income and enthusiasm of rice producers. The theoretical purchasing price is higher than the actual price with the full cost of production under the conditon that the bargaining power of rice producers is bigger than rice dealers or the rice producers is bigger than rice dealers. Even if with the incomplete cost of production, the theoretical purchasing price is still higher than the actual price when the bargaining power of rice producers is similar with rice dealers. So the low rice price must cause the low productive income and enthusiasm of rice producers with the rise of the production cost.3. The main reasons of low rice price are that hidden costs of rice are ignored and the trading position of rice producers is low.The proportion of family labor costs and family land rent in total production cost is 46.6%,73.2%,80.8% respectively in plain, mountainous and hills.The hidden costs of rice are not included in the total cost when rice producers ask price and rice dealers bid price which causes the actual purchasing price is lower than the theoretical purchasing price. And the weak bargaining position of rice producers make the purchasing price conducived to rice dealers.4. The main reasons of differences in production costs are differences in the amount of labor input in different areas.The degree and coverage of mechanization of production in plain are all higher than mountainous and hills, furthermore the traffic conditions is poor and the paddy field is small in mountainous and hills, so the number of labor input is big in mountainous and hills and it is small in plain. According to the survey data, the differences in production costs between mountainous and hills are 96.5%from differences in the amount of labor input, the differences in production costs between mountainous and plain are 93.8%from differences in the amount of labor input, the differences in production costs between hills and plain are 90.7%from differences in the amount of labor input.Innovations1. Improvement on pricing model. The pricing model built in this paper includes the production and distribution costs, contribution coefficient of rice producers and dealers contributed to the value of rice and bargaining power of rice producers and dealers. It is more comprehensiver, more specificer, more realisticer than the previous model.2. Study found that hidden costs of rice are ignored and the trading position of rice producers is low are the main reasons of low rice purchasing price.3. Study found that the differences in the amount of labor input are the main reasons of differences in production costs in different areas.Further research problems1.How to improve the rice purchasing price and protect the income of rice producers is the further research problem.2.How to increase the degree of mechanization of rice production and reduce the labor costs of rice production is the further research problem.3. How to improve the degree of organization of rice production and balance the market position of rice producers and dealers is the further research problem.