Stimulating Consumption

Direct-buy program benefits retail, agriculture

By Liu Jie (China Daily)
Updated: 2009-11-09 07:49

A customer shops for fresh fruit at a Wal-Mart supermarket in Loudi, Hunan province. The world's leading retail chain is using its Direct Farm Program in China to reduce operating costs, increase farmers' incomes and promote 'green' agriculture practices. [Newsphoto]

It was the third time for Wang Jianjing, a 58-year-old Beijinger, to buy winter jujube (dongzao in Chinese) within a week at a Wal-Mart hypermarket located in Wangjing, a residential community in northern Beijing.

"Winter jujube is just in season now. The fruit sold here is sweet, juicy and crisp. I also found the price (18 yuan per kg) is even lower than that at the open market," said Wang, who recently bought 2 kg as an after-dinner treat for a 10-member family reunion.

Nearly 700 km away, Wu Zhanjun, a farmer in Zhanhua, Shandong province, a well-known dongzao planting base in China, said he was pleased that 7,500 kg of his winter jujube was sold directly to Wal-Mart at 12 yuan (29 cents) per kg - 2 yuan higher than the purchasing price offered by local dealers.

"They (Wal-Mart) are also responsible for transportation, always a headache for me," Wu said.

Farm program

Both Wang and Wu are benefiting from the Direct Farm Program, under which Wal-Mart Stores Inc cooperates with the Ministry of Commerce and the Ministry of Agriculture to directly purchase agricultural products from farmers nationwide.

Direct-buy program benefits retail, agriculture

Doug McMillon

The program is based on the principles of guiding farmers, strengthening connections, promoting distribution channels and guaranteeing food safety, according to the government ministries.

Wal-Mart said that the Direct Farm Program helps farmers to upgrade their abilities to adapt to the market, encourages production and supports environmental protection in the agriculture sector.

In addition to purchasing agricultural commodities directly, the retailer is engaged in providing market information and free training sessions to farmers on scientific planting, green cultivation technologies and natural resources protection.

The Direct Farm Program optimizes the industrial supply chain and food safety standards, and also increases farmers' incomes, according to Wal-Mart (China) Investment Co Ltd.

The US-headquartered supermarket behemoth started the Direct Farm Program in China in 2007.

Over the past three years, the company has set up 11 direct purchasing bases in seven municipalities, provinces and autonomous regions that cover a total area of 10,000 hectares and directly benefit more than 200,000 farmers.

Besides winter jujube purchased from Shandong, Wal-Mart directly buys vegetables from Nantong in Jiangsu province, Miyun in Beijing and Guiyang in Guizhou province.

The company purchases apples and grapes from Wafangdian in Liaoning province and organic cereals from Jianping in Liaoning province.

"Direct Farm is one of the most representative examples of our company's sustainability strategy," said Doug McMillon, president and CEO of Wal-Mart International.

"This initiative gives us a chance to bring our global experience in sustainable agriculture to China's supply chain, boosting scientific farming, environmental protection and strengthening the monitoring of food safety, which eventually delivers our Chinese customers quality products at a low price," McMillon said.

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