Target prices for cotton in China to be set every three years
The National Development and Reform Commission (NDRC) said in a statement it has set its 2017-2019 target price for cotton at 18,600 yuan($2,695) a tonne, unchanged from its 2016 goal even as domestic and global prices have soared.
The target price will now be set every three years, the state planner said, but can be adjusted if there are major changes in the cotton market. The move is aimed at curbing big changes in output from year to year, the government said.
Under the new plan, the NDRC has also set a limit for how much cotton grown in Xinjiang can benefit from future subsidies. Subsidies for Xinjiang cotton over the next three years will apply only to output that is less than 85 percent of the average national annual production for 2012-2014.
China gives higher subsidies to growers in Xinjiang than other regions, leading farmers elsewhere to plant other crops. Xinjiang now produces at least 67 percent of China's cotton.
The policy changes come after China launched a three-year trial in 2014 to set target prices for Xinjiang cotton, which the government said on Friday has improved the quality and competitiveness of China's cotton.
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