During China’s NPC&CPPCC this March, Wei Lihua, Junlebao Dairy Group Chairman and CEO, said that the family-owned small-scaled dairy farms have less collateral and pledge than industrial enterprises due to the nature of China’s agricultural industry. The scope of agricultural mortgages is relatively narrow, leading to financing difficulties. Some family farms invest millions of dollars for several years and almost throw all savings into expanding the scale of operation, such as purchasing equipment. However, they may ignore the funds in the dairy production chain. The shortage of funds seriously affects the normal production process of family farms.
According to the family farm credit needs characteristics, he suggested strengthening the innovation of agricultural financial products and services. He also thinks that expanding the scope of new business entities’ property (barns, biological assets, etc.) can be included in the mortgage for various agri-financial services and support.