"Agricultural product e-commerce should make new contributions to promoting consumption." Recently, at the 2024 China Agricultural Product E-commerce High Level Seminar, Ding Junfa, former Chief Economist of the Ministry of Domestic Trade and renowned expert in circulation economy, stated, "The Ministry of Commerce has designated 2024 as the year to promote consumption, and agricultural product e-commerce has no other responsibility. We need to explore new driving forces of agricultural product e-commerce and innovate new models of agricultural product e-commerce."
The seminar has been held for eighteen consecutive sessions, guided by the Circulation Department of the Ministry of Commerce and the Agricultural Information Center of the Ministry of Agriculture and Rural Affairs, and hosted by a 30 person forum on digital agricultural product e-commerce. During the meeting, leaders of relevant departments, representatives of agricultural e-commerce enterprises, scholars, and industry professionals summarized the past practices and experiences of "promoting agriculture through digital commerce", and explored future development and innovation paths.
"China has become the world's largest e-commerce country for agricultural products." Wang Xiaobing, Director of the Information Center of the Ministry of Agriculture and Rural Affairs and Secretary of the Party Committee, said, "For more than 20 years, China's e-commerce for agricultural products has grown from scratch, from small to large. The key is to use Internet technology and information technology to achieve production and marketing docking, and the key is to constantly innovate and use new technologies, new media and new platforms in the development process."
According to data from relevant departments, the online retail sales of agricultural products in China reached 587.03 billion yuan in 2023, an increase of 12.5% compared to the previous year, showing a good trend of competitive development in the eastern, central, and western regions, and accelerated coverage of various agricultural products. E-commerce platforms represented by Pinduoduo are expected to lead the digital transformation of Chinese agricultural products.
"Digital agricultural product e-commerce is a new type of productivity." Ding Junfa said that agricultural product e-commerce will play an increasingly important role in the development of agriculture, rural areas, and farmers, especially in rural revitalization, targeted poverty alleviation, and changing the production, circulation, and consumption patterns of agricultural products. "Digital e-commerce is not only a necessary path for the development of traditional agricultural product e-commerce, but also a concrete manifestation of developing new quality productivity."
Increase in the scale of agricultural products entering cities
The decrease in "toll fees"
At the seminar on that day, Hong Tao, a professor at the School of Economics of Beijing Business University and an e-commerce consulting expert from the Ministry of Commerce, released the "2024 China Agricultural Product E-commerce Development Report" (hereinafter referred to as the "Report"). The report shows that as China enters a new economic and consumption cycle, digital agricultural product e-commerce has also entered a period of high-quality development. At present, the key tasks should shift towards digitalization of agricultural information services, smart agriculture, as well as digitalization of production, processing, marketing, logistics, branding, and other links, in order to achieve an overall transformation of the industrial form.
The application of digital technology to the agricultural industry has been explored within the industry. Taking Pinduoduo as an example, the platform builds a "Farmland Cloud Pinyin" system to gather scattered agricultural product demands online, forming popular products, reducing intermediate links, allowing agricultural products to directly connect to consumer dining tables, reducing terminal selling prices and increasing farmer income.
Through the re investment of digital economy infrastructure such as fresh and cold chain logistics system, Pinduoduo has established industry standards for fresh agricultural products to be shipped within 48 hours, including compensation for bad fruits, and free shipping in remote areas. Taking Xinjiang as an example, the platform has been cooperating with express delivery companies such as China Post since the second quarter of last year to open Xinjiang parcel transit, consolidation, and free shipping services, improving the online shopping experience of Xinjiang consumers.
Wang Xiaobing, director of the Information Center of the Ministry of Agriculture and Rural Affairs, analyzed that the key to the rapid and good development of agricultural products e-commerce lies in the continuous use of new technologies and the realization of production and marketing docking through Internet technology and information technology.
The Agricultural Cloud Action is an important measure taken by Pinduoduo to guide the integration of data and reality in agricultural production areas. In 2023, Pinduoduo launched the Agricultural Cloud Action, delving into agricultural belts in Shanxi, Sichuan, Shaanxi, Yunnan, Hubei, Fujian, Shandong, Jiangsu, and other regions to provide e-commerce operation training and one-on-one operation guidance for local businesses, helping to revitalize rural industries and increase employment. The Agricultural Cloud Action has also been rated as a "typical case of national county revitalization" by the China Urban and Small Town Reform and Development Center of the National Development and Reform Commission.
The report shows that the scale of e-commerce "going to the countryside" and agricultural products "going out of villages and into cities" is continuously increasing. According to the report, in 2023, the online retail sales of agricultural products in China reached 587.03 billion yuan, which is about five times that of 2014. In addition, the total logistics volume of agricultural products in China has reached a new high, with a total logistics volume exceeding 5.3 trillion yuan in 2023, a year-on-year increase of 4.1%. From 2021 to 2023, the total logistics volume of agricultural products has exceeded 5 trillion yuan for three consecutive years. Although the scale of agricultural products entering cities has increased, the "transportation cost" has decreased. Data shows that logistics rates have decreased from 18% in 2012 to 14.4% in 2023.
Wang Xiaobing stated that the online retail of agricultural products in China is showing a good trend of competitive development in the eastern, central, and western regions, with accelerated coverage of various agricultural products. "Rural e-commerce has transformed the traditional circulation mode of agricultural products and become a breakthrough and leader in the development of rural digital economy."
Starting from people and technology
Cultivate new agricultural productivity
The report points out that e-commerce should be endowed with new connotations in the process of agricultural digital upgrading. In addition to physical agricultural product transactions, digital agricultural product e-commerce should also include service-oriented agricultural products, experiential agricultural products, etc. The report proposes that e-commerce platforms represented by Pinduoduo will lead the digital transformation of China's agricultural products.
Zhan Xinyu, Executive Dean of the School of Economics at Beijing Gongshang University, stated that although agricultural e-commerce has achieved many results in recent years, there are still some problems that need to be solved, one of which is the current situation of talent shortage in the rural e-commerce industry.
The person in charge of Pinduoduo stated that many young people are interested in e-commerce, but initially had no concept of e-commerce management. How to support "new farmers" is very important. "Our business personnel answer questions for merchants in real time every day, track and analyze their business situation for a long time, intervene and provide improvement suggestions in a timely manner for operational problems. In addition, through the Agricultural Cloud Action, we conduct annual inspections in the agricultural belt, provide on-site training, and also design one-on-one business ideas and plans for merchants through visits.".
According to a survey by Pinduoduo, as of 2021, the proportion of new young merchants born in the 1990s, 95s, and 2000s on the platform exceeded 49%, and the proportion of "new and new farmers" born in the 1990s exceeded 13%, with over 126000 people, most of whom were young entrepreneurs returning to their hometowns. Moreover, a "new and new farmer" returning to their hometowns can drive 5 to 10 95s.
The above person in charge stated that the best way to support "new and new farmers" is not to directly give money, but to establish a complete set of platform mechanisms to stimulate the leapfrog development of new farmers, making the system an amplifier of digital agriculture. "Under the traditional streaming method, many merchants believe that the strong will always be strong, and that strong efforts can lead to miracles. However, this approach is not feasible on Pinduoduo. Our platform mechanism has always adhered to product orientation, encouraging merchants to innovate their products. As long as we do a good job in product differentiation, there is an opportunity to grow and become stronger."
How to improve the quality of agricultural products and focus on product innovation is also one of the problems currently faced by agricultural e-commerce. The report points out that some agricultural e-commerce enterprises face the problem of homogeneous competition, resulting in higher competition costs and lower benefits.
To support the high-quality development of agricultural e-commerce, Pinduoduo has launched a "technological revolution" in the fields. Pinduoduo has been supporting competitions such as the Duoduo Agricultural Research Technology Competition and the "Pinduoduo Cup" Science and Technology Academy Competition for many years, helping to innovate agricultural technology, transform scientific research achievements, and promote high-quality agricultural products.
Taking the Science and Technology Academy Competition as an example, it is reported that Pinduoduo has served as a support party for the competition for two consecutive terms, assisting university students in exchange and supporting the development of scientific and technological agricultural products. For example, Pinduoduo provides active support for characteristic agricultural products such as Chu Orange, Danleng Orange Technology Academy's main focus on orange, and Fujian Pinghe Honey Pomelo Technology Academy's focus on honey pomelo, which are studied by Chu Orange Technology Academy. Pinduoduo has implemented policies such as zero commission and billion yuan subsidies for agricultural products to benefit farmers.
"E-commerce for agricultural products has great potential," Ding Junfa said. He suggested that the innovation of agricultural product e-commerce models and scenarios should start with talents, production tools, and production relations. Firstly, to cultivate strategic talents who can create new quality productivity and application-oriented talents who are proficient in mastering new means of production; Secondly, fully utilize new production tools, master core technologies, and empower the development of new agricultural product e-commerce; Thirdly, we need to shape production relations that adapt to the development of new quality productive forces, focusing on breaking through the bottlenecks and obstacles that hinder the development of new quality productive forces, and enabling advanced and high-quality production factors in China to efficiently allocate towards the development of new quality productive forces.
