China Grain Logistics Industry Development Prospects and Investment Forecast Report, 2013-2017

◆ Development Status

In 2011, the national grain area was 110.57 million hectare, up by 0.7 million hectare; in 2011, the yield of national grain reached 571.21 million tons, up by 24.73 million tons, with an increase of 4.5%, among which the yield of summer grain was 126.27 tons, with an increase of 2.5%; the yield of early rice was 32.76 million tons, with an increase of 4.5%; the autumn yield was 412.18 million tons, with an increase of 5.1%. The grain yield had achieved the consecutive 8-year growth for the half century.

However, the growth of grain yield can not well stable the uprising of grain price. The reason of that is China’s grain modern logistics is still relatively backward. The high price of logistics, low efficient, and huge consumption are prominent problems.

In 2011, the logistics amount of China agricultural was 22,000 Yuan, with a year-on-year increase of 4.5%. For the consecutive 8 years, the China agricultural production yield has shown a strong momentum to develop. However, the proportion of China’s agricultural product logistics in the total logistics amount keeps decreasing. In 2011, the proportion had already decreased to around 1.39%. It shows China’s agricultural product logistics hasn’t completely built up its position, and China agricultural product logistics still has the relatively space for development.

◆ Foreign Experience

The development of high efficiency grain logistics system in international are represented by the major grain supply chains of US, Canada, EU, Australia and so on, which are mainly export grain. With the improvement of agricultural production capability and the increase of the agricultural product trading amount, the grain logistics systems in these developed countries are generally shifting to be professional, networking and highly efficient, and form a storage system with the clear division of labor, and the supporting equipment, which also contains receiving and containing storehouse, mechanized transit storehouse as well as professional transport tools and handling instrument; establish an improved grain export logistics system, which collect and send the grain in domestic to export ports, and then the grain enters to the international market. The application of mechanization and automation systems, as well as the information technology further promotes the development of grain logistics.

Characteristics of Modern Grain Logistics System: （1）there are four circulation means of grain logistics. The realization of grain bulk, bulk uploading, bulk transport, and bulk storage is the important mark of the modernization realization for developed national grain circulation. The more regulated of the “four bulk” system, and the more advanced technology in the grain circulation, the less loss and the lower cost will be, which will bring huge economic effect and social effect.（2）scientific and rational layout of grain logistics nets. Systematization is the primary condition for the development strategy of modern grain logistics. The developed countries have finished restructuring their traditional grain logistics technology, forming a modern grain logistics system with rational layout of logistics nets, coordinated and supporting upstream and downstream logistics circulation enterprises, strong and high-efficient logistics route system, as well as the advanced logistic technology and management level.（3）the concentration rate and organization level of grain production and circulation are high. The grain can realize scale production, so the grain logistics concentration is high and the logistics cost can greatly lower down.（4）the marketization level of grain circulation is high. In some grain circulation developed countries, such as US and Australia, due to the richness of the grain resources, the governments of these countries will not reserve grain or reserve little grain. By the market way, the governments encourage private grain reserves.（5）The laws and regulations in grain circulation field are relatively completed. By legislation, the developed countries regulate the responsibility, rights and duties of grain production, storage, transport, processing and selling. According to laws, draw up fiscal plans and usage regulation for the national development of grain production and circulation. Thus, all links of grain logistics, “from land to dinner table” can be operated according to laws, and the supervision and management can all be operated according to laws as well.

◆Policy Review

On June 2011, Primer Wen Jiabao chaired a State Council Executive Meeting, to study and plan to promote the healthy development of logistics industry. The meeting pointed out to draw up completed supporting policy measures, to promote the healthy development logistics industry, and come up with Eight Dos, namely “The State Eight Rules”. Firstly, substantially reduce the burden of logistics enterprises. Secondly, increase efforts to land policy support of logistics industry. Thirdly, promote the convenience passage of logistic vehicles. Fourthly, improve the management of logistic enterprises. Fifthly, encourage to integrate the logistic facility resources. Sixthly, advance the innovation and application of logistic technology. Seventhly, increase the investment in logistics industry. Eighthly, promote the development of agricultural product logistics industry.

On August 19th 2011, The View of State Council on Policies and Measures of Promoting the Healthy Development of Logistics Industry was released. There are 9 rules in the View, including: substantially reduce the taxation burden of logistics enterprises; increase efforts to land policy support of logistics industry; promote the convenience passage of logistic vehicles; encourage to integrate the logistic facility resources; advance the innovation and application of logistic technology; increase the investment in logistics industry and first to develop the agricultural product logistics industry and strengthen the organization coordination.

On December 28th 2011, The “Twelfth Five-year” Development Plan for Grain Industry was released. In terms of improving storehouse, the Plan pointed out to strengthen the construction of storehouse equipment, advance the maintenance and reconstruction of storehouse, improve drying facility and conduct special plans for farmer scientific grain reserves; in terms of promoting the development of modern grain logistics, the Plan pointed out to open the channels of “North-South Grain Transportation”, improve the main road in Yellow-Huaihe-Haihe areas and build up the modern grain logistics service system.

On January 11st 2012, The “Twelfth Five-year” Construction Plan for Grain Circulation Infrastructure was released. The Plan pointed out, by 2015, the grain circulation infrastructure will basically meet the demand for grain yield growth and security supply. Improve the grain storage system to reach the modernization level; the facility condition of basic grain storehouses is prominently improved, the outdoor grain storage can be diminished in the long-term, and build a long-acting mechanism of maintenance and reconstruction; the outflow facility capability of major cross-province channels is strengthened, the bulk grain train “enter the port” has been basically realized, and the proportion of bulk grain circulation is prominently improved; improve the agricultural grain reserves conditions, and reduce the grain loss. During the ‘twelfth five-year” period, the total investment of grain circulation infrastructure will reach 47.9 billion Yuan (excluding the land expense), among which there is 17.3 billion Yuan for grain and oil storage/drying facilities, 9.6 billion Yuan for storehouse maintenance and reconstruction, 11.8 billion Yuan for modern logistics construction, and 9.8 billion Yuan for special farmer scientific grain reserves.

During the “twelfth five-year” period, China logistics industry’s basic thinking is, on the basis of grasping and implanting the Logistics Adjustment and Revitalization Plan, which was announced by the State Council, to emphasize the “twelfth five-year” strategic planning on the development of logistics industry. Moreover, positively assist relevant departments to plan the middle and long-term development plan for logistics industry, 2011-2020. By the end of “twelfth five-year” plan, a modern logistics service system with the rational layout, advanced technology, energy-saving and protection, convenience and high-efficiency, safely order, as well as international competitiveness will be basically formed. The logistics industry will shift from focusing on infrastructure construction to promoting overall service quality. In addition, the Development and Reform Commission will finish the major special logistics plans for grain logistics, logistic parks, coal logistics, and emergent logistics. These four special plans will combine with the cold chain logistics plan and commodity logistics plan, forming the six major special plans for promoting the development of logistics industry.

Prospects Forecast

Developing modern grain logistics, as well as improving automation, informatization, and systematization of grain circulation play very important roles in lowering circulation cost, promoting the development of grain processing industry, increasing farmer income and insuring the national grain security. The Modern Grain Logistics Development Plan proposed, it’s predicted that China cross-province grain “Four Bulk” transport system and emergent regulation system will be finished constructing. The bulk circulation share will occupy 55% of national grain circulation, among which the bulk circulation share will take up 80% of domestic cross-province bulk grain circulation, and the major channels of bulk grain circulation have basically realized the bulk grain transportation. Afterwards, all regions are draw up the development plans for modern grain logistics in succession, which point out the development direction and provide policy support for the development of China grain logistics. The grain logistics of all regions achieve the fast development as planned, and the modern grain logistics has unlimited prospects for development.

◆ Report Overview

The report mainly analyzes the development environment of China grain logistics; the development experiential learning of foreign grain logistics; the development situation of China grain market; the development situation of grain logistics parks; the development situation of grain logistic informationization; the development situation of grain logistics in regional markets; the relevant corporations’ operational conditions in grain logistics; as well as the development prospects and investment suggestions of grain logistics. Meanwhile, with comprehensive and specific first-hand market data over the past 5 years, Forward helps you to grasp the market and development trends of grain logistics, so as to win advantages from competition!

The most distinctive characteristics of this report is forward-looking and timeliness. Through analyzing forward-looking characteristic of abundant first-hand market data, we deeply and objectively dissect China current grain logistics’s overall market size, and competitive landscape. Furthermore, based on future development tracks and years’ practice experience of grain logistics, we conduct prudent analysis and forecast for grain logistics’s future development trend. This report helps grain logistics enterprises, grain processing and marketing enterprises, as well as investment enterprises to precisely grasp current latest developments of the industry. Afterwards, they can make wise operating decisions and define enterprises’ development directions.

Here, we would like to express our sincere gratitude to State Information Center, Bureau of Statistics of China, International Information Research Institute, Chinese Academy of International Trade and Economic Cooperation, Tsinghua University Library, Development Research Center of the State Council and Beijing Essence Forward Research Center, for their great support when we conduct this report!

Notice: All the market data, especially corporations' ranking data in the report, only for business reference. Please do not take the data for enterprise publicity. Thank you! Or Forward shall not take any responsibility for any consequences!

Qianzhan Business Information Co., Ltd. Industry Research Center
Research Team of Grain Logistics Industry