Industrialized operation of agriculture plays a more and more important role in the development of China’s agriculture economy. After decades of development, the industrialized operation of China’s agriculture develops rapidly, the number of industrialized organizations increases a lot, the group of leading enterprises booms, the profit combination system is improving, and the capacity of pulling the income of farmers.
1. Basic condition of agriculture industrialization
Against the new demand for agriculture, enterprises should promote the industrialization though the change in operation concept, development method, and acceleration of development. This has achieved obvious result by the end of the “Tenth Five-year Plan” period.
(1) Rapid development of industrialized operation organizations. There are 135,725 agriculture industrialized organizations, 19.1% more over that of 2004. Among these are 61,268 leading enterprises or 45.1% with 4010 with sales over 100 million RMB; 62,914 intermediaries or 46.4% in which 15,060 participate in the agriculture industrialized professional operation; 11,543 professional markets or 8.5% of the total number of industrialized enterprises, in which 3824 has trade volume of over 50 million RMB. The total volume of fixed assets is 978.5 billion RMB, 20.8% more. The fixed asset of leading enterprises is 871 billion RMB, 89% of the total volume. The staff of industrialized organizations is 34.19 million, 2.5% more, in which that of leading enterprises is 21 million, 61.4% of the total number.

(2) Maturity of profit combination system. In all kinds of combination of industrialized organizations with farmers, contract takes 55.3%, cooperation 16%, stock holding cooperation 15.2%, and other forms 13.5%. Contract, cooperation and stock holding cooperation take 86.5% of all the forms, 6.6% more than that of 2004. In contract relationship, order relation has reached 59,549, taking 43.9%, 10.9% more than the previous year; the total value of orders is 377.9 billion RMB, and implement rate of contracts reaches 80.7%, 0.1% higher.
(3) Improvement in comprehensive profit. The sales of leading enterprises is 1844.4 billion RMB, net profit 118.2 billion RMB, tax 58.64 billion RMB, increasing by 29.4%, 31.4% and 21.7% than 2004. The income of intermediaries is 272.5 billion RMB, 29.3% more than that of 2004; the trade volume in professional markets is 943.9 billion RMB, net profit 39.4 billion RMB, tax 12 billion, growing by 9%, 5.9% and 9.6%.
(4) Increased pulling strength. Among all the industrialized organizations, there are 62000 planting enterprises with 0.969 billion acres; grazing enterprises 43000 with 0.739 billion live stocks; marine product enterprises 8579 with raising area of 77.21 million acres of water. Industrialized organizations pulled 87.26 million farmers (in which orders pulled 59.53 million), 3.2% more, and takes 35.2% of the farmers in China. The increases income from the industrialized organization is 116.6 billion RMB, and on the average 1136 RMB per capita, 11.1% higher.
(5) Enhanced level of opening up. In 2005, leading enterprises realized export of 23.127 billion USD, 11.2% more and took 83.8% of the total export of agriculture and 0.5% more than the previous year. Meanwhile, leading enterprises strengthened international cooperation and attracted foreign investment. In 2005, 9384 leading enterprises induced foreign investment with a total investment of 6.9 billion USD, 5.65 more than that of 2004.

(2) Maturity of profit combination system. In all kinds of combination of industrialized organizations with farmers, contract takes 55.3%, cooperation 16%, stock holding cooperation 15.2%, and other forms 13.5%. Contract, cooperation and stock holding cooperation take 86.5% of all the forms, 6.6% more than that of 2004. In contract relationship, order relation has reached 59,549, taking 43.9%, 10.9% more than the previous year; the total value of orders is 377.9 billion RMB, and implement rate of contracts reaches 80.7%, 0.1% higher.
(3) Improvement in comprehensive profit. The sales of leading enterprises is 1844.4 billion RMB, net profit 118.2 billion RMB, tax 58.64 billion RMB, increasing by 29.4%, 31.4% and 21.7% than 2004. The income of intermediaries is 272.5 billion RMB, 29.3% more than that of 2004; the trade volume in professional markets is 943.9 billion RMB, net profit 39.4 billion RMB, tax 12 billion, growing by 9%, 5.9% and 9.6%.
(4) Increased pulling strength. Among all the industrialized organizations, there are 62000 planting enterprises with 0.969 billion acres; grazing enterprises 43000 with 0.739 billion live stocks; marine product enterprises 8579 with raising area of 77.21 million acres of water. Industrialized organizations pulled 87.26 million farmers (in which orders pulled 59.53 million), 3.2% more, and takes 35.2% of the farmers in China. The increases income from the industrialized organization is 116.6 billion RMB, and on the average 1136 RMB per capita, 11.1% higher.
(5) Enhanced level of opening up. In 2005, leading enterprises realized export of 23.127 billion USD, 11.2% more and took 83.8% of the total export of agriculture and 0.5% more than the previous year. Meanwhile, leading enterprises strengthened international cooperation and attracted foreign investment. In 2005, 9384 leading enterprises induced foreign investment with a total investment of 6.9 billion USD, 5.65 more than that of 2004.

(6)Improvement in policy environment. All government departments strengthened their support to agriculture industrialization. In 2005, the bank loans of leading enterprises were 235.9 billion RMB, 24.6% more than that of 2004; the financial support was 9.7 billion RMB, 15.9% more.
2. New trend of agriculture industrialization
The Fifth Plenary Session of the Sixteenth Congress of CPC planned the deployment of the establishment of socialist new village and made higher requirements for the industrialization of agriculture and also provided vaster room of development. All kinds of industrialized organizations participated in the construction to promote the transition from rapid development to innovation and creation.
(1) Expansion of organization functions. Agriculture industrialized organizations transit from individual operation participants to new agriculture production bodies. This plays a more and more important role in the rural economy development, new village construction and national macro-economy development. Some capable leading enterprises made full use of their advantage in capital and participated in rural infrastructure construction and social public undertakings, and played a vital role in improving the condition of rural areas.
(2) Innovation in pulling methods. Organizations actively suited the requirements of socialized production and organized market to expand their methods of pulling the development of agriculture and the increase in the income of farmers. On the basis of “company + farmers,” several more types of combination such as “company + base + farmers,” “company + intermediary + farmers,” “professional market + farmers,” and “cooperation organization + farmers” emerged.

(3) Increase capacity of processing. The deep processing capacity of leading enterprises is greatly improved.
(4) Increased channels of investment. The investment in agriculture industrialization has changed from the single finance investment to the diversified structure with finance investment as the direction, private capital, industrial and commercial capital and oversea capital as main body and financing loan capital as support. At present, the Bank of Agriculture Development has clarified that the support targets expand from leading enterprises of corn, cotton and oil to all leading enterprises of agriculture industrialization above the municipal level.
(5) Expansion of outward field. Leading enterprises all strengthened their competitiveness and enhanced their own outward level to implement “going out” strategy by investment in construction, merging and purchasing, share holding, renting, listing and technology share holding. At present, there are more than 40 leading agriculture enterprises with oversea investment, or cooperation, or listing, with a total investment of over 13.5 billion RMB (1.245 billion USD, 5.224 billion RMB and 12.05 million EU), and the investment involves over 30 countries and regions in Asia, Africa, North America, Europe and Australia. Some capable leading enterprises have been listed overseas by capital operation.
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