China National Radio (CNR):

We have noticed that the added value of the primary industry dropped 3.2%. What is the cause of this? And does it have negative implications for the agriculture sector? Many people have begun stockpiling grain. Is this necessary? Thanks.

Mao Shengyong:

Thanks for your questions. The decrease in the added value of the primary industry is mainly attributed to the slow course of animal husbandry. As we all know, due to the African swine fever, hog production has seen a year-on-year decrease despite monthly increases. Hence, the pork production in Q1 decreased 29.1% compared to the same period last year. The epidemic has also affected livestock and poultry production, causing a decrease of 10.6% on animal husbandry's total output value. In Q1, the output of animal husbandry accounted for 45% of the entire primary industry, so its slowing drove down the growth of the added value of the primary industry. 

Second, agriculture production now goes well. As it stands, spring plowing and planting has proceeded in an orderly fashion, essentially unaffected by the epidemic. Winter wheat, which accounts for more than 90% of the total summer crops, is growing well. According to a survey, the sown areas in many granary provinces maintain continuous growth, reversing a multi-year trend of decline. In addition, the advantageous conditions and situation for agriculture production provide favorable conditions for this year's grain harvest. 

Third, the current grain price is generally stable. As we all know, the yearly grain output has surpassed 650 billion kilograms in the past five years, reaching a record high in 2019. Currently, the self-sufficiency rate of grain in China is quite high, and we have an abundant stockpile. Therefore, from the perspective of supply and demand, the grain price remained stable in the first quarter despite the large impact of the epidemic. Even in hard-hit places, including Wuhan, there was no major fluctuation in prices. The grain price in Q1 increased 0.6% year on year, and the price in March grew 0.7% compared to the same period last year. Both are modest increases, and the monthly increases are even. It indicates that China has strong grain supply capacity and the supply-demand relationship is generally stable. Therefore, the country is fully capable of feeding its people. 

Fourth, in terms of animal husbandry, livestock production is improving, especially hog production. Along with the further resumption of work and production and the implementation of supportive policies, hog production is being resumed and greatly improving. By the end of Q1, pig stocks grew 3.5% compared to the end of last year, and the number of breeding sows increased 9.8%, maintaining growth for two consecutive quarters. Therefore, the entire animal husbandry sector is speeding up resumption and improvement. Thank you.