Analysis of China’s planting industry of main grain crops, October 2019

Food production has a significant impact on farmers' income, social employment, economic growth, state revenue and social income. Maintaining good grain production is of great significance to economic and social prosperity, stability and full utilization of social resources.
1 Analysis of Agriculture related product prices  
1.1 Analysis of price trends of agricultural materials
Fertilizer prices: During the period of planting grain crops and applying fertilizer from Sept. 2018 to Aug. 2019, the prices of nitrogen fertilizer, muriate of potash and NPK respectively increased by 7.69%, 2.99% and 0.96%, with an average growth of 3.88%. The rise in fertilizer prices inevitably brought about the increase of fertilizer cost in grain production in 2019/20 crop year. In September and October 2019, the prices of urea, muriate of potash and NPK in China decreased by 3.92%, 0.33% and 1.13% respectively compared with the same period of last year, and the average price of these three products fell by 1.79%.
Pesticide prices: The average price of pesticide declined by 3.53% year-on-year from Sept. 2018 to Aug. 2019, and it fell by 11.17% year-on-year in Sept. 2019.  
Diesel prices: From Sept. 2018 to Aug. 2019, the average price of diesel in domestic rose by 3.53% year-on-year, and it fell by 13.7% year-on-year in the period from Sept. to Oct. 2019.  
Seed prices: Affected by high concentration of supply and national policies, seed prices rose to a certain degree, which impacts the cost benefits of various products.
Labor cost: According to data released by the National Bureau of Statistics, the per capita disposable income of rural residents from Jan. to Sept. 2019 was 11,622 yuan, up 9.2% year-on-year. Farmers' income from wage and salary was 5240 yuan/person, up 9.4% from the same period last year; their operating income was 3626 yuan/person, a year-on-year growth of 7.2%; the per capita income of migrant workers was 3,952 yuan/month, rising by 6.2% over the previous year. In general, the growth in prices of agricultural materials and labor costs will greatly reduce the disposable income of farmers.
2 Analysis of grain price trends in 2019
The purchase of grain has finished, and the annual price from May 2018 to April 2019 averaged 2446yuan/ton, a year-on-year decrease of 1.78%. The prices of three major grain crops averaged 2279yuan/ton, down 2.65% year-on-year. From May to October, 2019, the combined price of grain crops was 2416yuan/ton, declining by 3.17% from the same period of the year before, while that of three major grain crops averaged 2248yuan/ton, down 1.88% year-on-year Since the beginning of the crop year of 2015/2016, the price of major grain crops have been basically declining, which has an adverse impact on grain production.