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Business / Industries

Capital inflow injects vigor to agriculture

(Xinhua) Updated: 2014-01-28 10:44

CHONGQING - Farmer Liu Xinglu earns 20,000 yuan ($3,278) a year renting his farm to an agricultural company. It doubles what he made before 2010 when he tended the plot himself.

Liu, from Jiangjin district, Southwest China's Chongqing municipality, is a farmer and employee of Hengjia Agricultural Development Co, to which he rents six mu of land (0.4 hectare). His earnings include rent fees and a salary from the firm.

Hengjia has rented 227 hectares of land to grow orange and lemon trees, at a cost of more than 50 million yuan ($8.2 million) since 2008 in a modern agricultural park.

Land transfers like that between Liu and Hengjia have increased over the past decade. Tens of millions of farmers have fled to the cities seeking jobs and large-scale farmers are emerging. Private capital from companies like Hengjia is flowing into the agricultural sector.

According to the Chongqing Agricultural Commission, 3.8 billion yuan in capital was invested in a total of 11,000 farming projects in Chongqing from 2008 to 2012.

Nationwide, agricultural investment increased 32.5 percent year on year to reach 924.1 billion yuan in 2013, according to the National Bureau of Statistics. The growth was much higher than the 17.4 percent seen in the secondary sector and 21 percent for the tertiary sector.

As investors discover the industrial value of agriculture, the acceleration of capital flowing into agriculture is inevitable, said Zheng Fengtian, a professor of agricultural and rural development at Renmin University of China.

Industrial and commercial capital can help transform agriculture through information technology, industrial production and management ideas, and tracking systems to ensure the quality and safety of agricultural products.

Some IT sector enterprises have already invested in agriculture.

In August 2012, Legend Holdings, parent company of Lenovo Group, China's leading personal computer maker, founded its subsidiary Joyvio Group for modern agriculture investment and business.

Qingdao Wallen Blueberry & Fruit Co Ltd, a subsidiary of Joyvio, has invested 250 million yuan in Shandong, Liaoning, Sichuan and Hubei provinces with over 1,000 hectares of cultivation plots. The company handles multiple areas, including seedling propagation, fruit planting and processing.

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