The Impace Analysis Of RMB Appreciation On China’s Grain Trade

With the process of economic globalization and regional integration, China has experienced rapid economic development. At the same time, the RMB exchange rate policy is also changed accompanied by the market needs and constantly adjust. After entering the21st century. China’s economic reform has deepened, and the exchange controls has also further relax, the economy development is stable and rapid, the world economic pattern has been changing as well.At the beginning of2003, Japan proposed to revalue the RMB exchange rate. The proposal was rejected, however, the appreciation of the RMB have become a hot international economic topic later.Because the relatively flat import trade and the rapid development of export trade which stands for a long time has formed a strong contrast, and the trade surplus is growing. The pressure of the appreciation of the RMB is enormous with the increasing trade friction and the increasing foreign exchange reserves,Therefore, the People’s Bank of China issued a circular on July21,2005, floating exchange rate system will be implemented based on market demand and making reference to a basket of currencies."People regard food as their prime wants ", the food problem relates to the well-being of the people and the country’s security and stability. With the development of China’s economy the proportion of the grain trade in the agricultural trade slowly narrows the count. But it is a problem which can never be ignored.The impact of the appreciation of the RMB to the grain trade is that there will be more and more food imports and it even increase our country’s foreign trade dependence to threat China’s food security. Therefore, the impact of the appreciation of the RMB to the grain trade is not to be underestimated.Therefore, at the background of appreciation of the RMB and with its change in China’s grain trade as the starting point, the paper analyzes the impact of appreciation of the RMB on China’s grain trade.The paper is divided into six parts:the first chapter is the introduction. It focuses on the research background and significance of the article, as well as the content of the study, methods, innovation and insufficiency, the definition of food and exchange rate.The second chapter is a literature review. It mainly describes the study of the impact of the changes of exchange rate on imports and exports trade from home and abroad, First it summarizes the overall impact of the changes of exchange rate on import and export trade, and then summarize the impact of the changes of exchange rate on import and export trade of agricultural products, at last it summarize the previous research and present writer’s views.The third chapter focuses on the changes of exchange rate of RMB, the status of grain trade and the influencing factors. This chapter is divided into two parts, the first part shows that the course of the RMB exchange rate reform in China as well as the impact of exchange rate factors, the second part describes the status of China’s grain trade, and analysis of four major foods briefly, finally analyzes the factors which affect the grain trade.The fourth chapter analyzes the impact of RMB appreciation on China’s grain trade in theory from positive and negative aspects.The fifth chapter uses the data of the third quarter of2005to the fourth quarter of2011as the object of study, it do an empirical analysis on the impact of the five major countries (the United States, Japan, Korea, Australia, Thailand,)of the appreciation of the RMB on China’s grain trade, through the establishment of model and the ADF test, co integration, Granger non-causality test method, it makes models for grain import and export trade of all countries which trades with China and operates in EViews6.0software, and then judge the impact whether or not presents and the size of extent, and finally through lag inspection, we judge there are significant lag effect or not about the changes of RMB exchange rate in China’s grain trade, namely the "J-curve effect" exists or not.The sixth chapter is the conclusions and implications. It analyzes the results of empirical and concludes with some inspiration and suggestions.