Current Situations and Problem s of Logistics for Guangxi Fresh Agricultural Products in the New Period and Recommendations

Shixiong ZHU

Nanning College for Vocational Technology，Nanning 530008，China

1 Introduction

Fresh agricultural products mainly include fresh primary products such as fruit，vegetable，and aquatic products，commonly called＂three fresh products＂.Logistics of fresh agricultural products refer to physical flow process of physical objects of fresh agricultural products from production to consumption，including organic integration of harvesting，purchasing，packaging，handling，loading and unloading，transport，storage，circulation，processing，distribution，delivery，and information processing of fresh agricultural products.Together with logistics of staple agricultural products and other agricultural products，it constitutes logistics of agricultural products.After entry to the 21st century，Guangxi agriculture also obtains considerable development.In 2012，the outputof fruit，pork，beef and mutton and poultry，and aquatic products reached 10.3095million tons，4.056million tons，and 3.047million tons，increasing about9.2%，5.1%and 5.1%respectively.Especially，the growth rate of fruit was higher than the national average level（6.6%），making Guangxi rank in the top five provinces with fruit yield up to 10 million tons and forming a good many superior and characteristic agricultural products.Rich products not only lay excellent foundation for development of agricultural product logistics，but also impose urgent requirement for development of agricultural product logistics.Accelerating logistics of Guangxi agricultural products is of great significance for solving the problem of difficult sales of agricultural products，promoting constant increase of yield and income of farmers，and guaranteeing consumption safety.

In recent years，many scholars have made exploration for logistics of Guangxiagricultural products including fresh agricultural products.Tang Yunyan［1］analyzed development of Guangxi agricultural products and put forward recommendations including accelerating construction of logistics infrastructure for Guangxi agricultural products，improving logistical level of agricultural products，cultivating and strengthening logistics entities of agricultural products，enhancing education of agricultural product logistics，and creating macro environment for development of agricultural product logistics.Using regional economics，international trade and modern logistics theories，Yuan Chunli［2］divided logistics of major agricultural products and processed goods in Guangxi into three types，and pointed out logistics of fresh agricultural products should be energetically developed in the form of wholesale market and chain supermarket.Li Chunxiang［3］analyzed superior conditions of Guangxi in developing green logistics of agricultural products and drawbacks of backward logistics technology，and came up with recommendations of building green logistics technology system for Guangxi agricultural products.Sui Bowen and Wang Jingmin［4］，combining actual situations of Guangxi Beibu Gulf Economic Zone，analyzed basic models of agricultural product logistics and proposed of wholesale market，chain supermarket and logistics center based agricultural product cold chain logistics model as cold chain logistics model of agricultural products for Guangxi Beibu Gulf Economic Zone.Li Yongxin analyzed［5］existing problems in current situations of Guangxi agriculture and logistics of agricultural products and proposed building integrated logistics center（park），cultivating specialized talents of agricultural products，building cold chain logistics in accordance with local situations，actively cultivating third party logistics enterprises，and constantly improving information construction of agricultural product logistics.With gradual deepening of agricultural industrial system and comprehensive technology reform，and improvement of farmers' enthusiasm，the problem of＂increasing yield but reducing income＂in fresh agricultural products of Guangxi is prominent.It is urgent to solve the problem of difficult sales of Guangxi fresh agricultural products and promote increase of yield and income.There are already researches of logistics of fresh agricultural products in Guangxi，but nearly no researches from the perspective of supply chain of fresh agricultural products.Through analyzing current situations and existing problems of logistics of Guangxi fresh agricultural products in the new period（21st century），we came up with recommendations for developing logistics of fresh agricultural products of Guangxi and promoting sustainable development of Guangxi agricultural products.

2 Current development situations of logistics of fresh agricultural products in Guangxi in the new period

2.1 Consecutive bumper harvests in fresh agricultural products leading to high demands of logisticsSince the implementation of the household contract responsibility system，Guangxi has realized consecutive bumper harvests in agriculture and fresh agricultural products.It has solved the food issue of more than 50million people and the market supply still has surplus，as listed in Table 1.From Table 1，we can see that except several years having unusual conditions，the general yield of fresh agricultural products of Guangxi increases year by year.The growth rate of 2012 is higher than 2000，reflecting constantly increasing logistics demand of fresh agricultural products in Guangxi.According to healthy diet standard recommended by Chinese Nutrition Society［6］，a person should eat 100－200 g fruit，400－500 g vegetable，125－220g fish，eggs，poultry，or meat foods daily.For 2012，after reserving 1.7089－3.4179 million tons of fruit，6.8357－8.5447million tons of vegetable，and 2.1362－3.4179 million tons of animal foods for 46.82 million permanent residents，it needed transfer or sell9.83－11.54million tons of fruit，15.02－16.73 million tons of vegetable，and 3.82－5.1 million tons of animal foods（28.67－33.37million tons in total）to other places，accounting for 74.21% －87.10%，63.74% －70.99%，and 52.78% －70.49%of total yield in the same year.Besides，Guangxi is an important production base of vegetable and citrus maxim a（Burm.）Merr.cv.Shatian.Yu，the yield of fresh agricultural products is extremely high.Therefore，fresh agricultural products of Guangxi urgently need developing logistics and broader sales market outside Guangxi.

Table 1 Yield of fresh agricultural products in Guangxi in main years and comparison between 2000 and 2012

2.2 Outstanding achievements in construction of logistics infrastructure

（i）Infrastructure of logistics starts to take shape.In 2009，Guangxi realized connection of counties through Class II and above highways，connection of towns through asphalt roads，and connection of villages through roads，and it has paved more than 41 highways above Class II with adjacent countries and provinces.In 2012，the total highway mileage in Guangxi reached 107900 km，including 2883 km expressways；Nanning Railway Bureau governs 4131.4 km railway mileage（3540.8 km in Guangxi）；Guangxi owns 8800 ships，6157 km shipping channels（5591 km open to navigation）；there is 6 civil airports，179 domestic and international flight lines，open to 41 domestic cities（including Hong Kong，Macau，and Taiwan），and 12 foreign cities.

（ii）It has built a good many freight sites（stations）.By the end of2012，Guangxihas built51840m harbor terminals and 648 production berths.By the end of 2004，there were already 115 road freight stations［7］and every year there is increase.

（iii）It has built a good many goods collecting and distributing centers.At present，there are more than 120 centralized logistics development zones and this number constantly increases.Since 2008，with approval of the state，Guangxi has established Qinzhou Free Trade Port Area，Pingxiang Integrated Free Trade Zone，Beihai Export Processing Zone，and Nanning Bonded Logistics Center.Besides，it also established several agricultural product wholesale markets designated by the Ministry of Agriculture，like Beihai Aquatic Product Wholesale Market，to provide facilities for circulation of three fresh agricultural products.With the aid of these logistics infrastructure conditions，highway，railway，water，and air transport of Guangxi completed transport of goods fore 1351.12 million tons，68.46 million tons，193.98 million tons，and 0.122 million tons respectively in 2012.The transport capacity is more than 48 times of total volume of three fresh agricultural products to be transferred and sold out in the same year.This indicates that logistics infrastructure is surplus after satisfying logistics demand of agricultural products.

2.3 Diversified development of logistics of fresh agricultural products with wholesale market logistics as major formThe development of logistics for Guangxi fresh agricultural products is divided into three stages：before the reform and opening-up，from the reform and opening-up to the end of 20th century，and after entry to the 21st century.Before reform and opening-up，goods were deficient and circulation was little，so the logistics development was slow or even stagnated.From the reform and opening-up to the end of20th century，logistics remained in the transformation growth period.After the implementation of reform and opening up，farmers' production enthusiasm rose and products increased rapidly.However，due to no full preparation in ideas and corresponding measures，most products were digested in local areas and the volume of logistics was small.In addition，transport means was simple，mainly by manpower of farmers，animal power or agricultural vehicles，thus the logistics belong to direct marketing logistics.After entry to the 21st century，quantity of agricultural products is constantly rising，logistics condition is gradually mature，the commodity rate increases year by year，and the volume of logistics is rising.This period belongs to steady growth period.To realize successful marketing，many types of logistics arise at the historicmoment.When direct marketing logistics fail to complete task of product sales，retailers of centralized purchasing of three fresh agricultural products appear.They purchase these products at low price and hire people to sell to higher wholesalers at higher price.This belongs to retail delivery logistics.Later，contractual logistics and wholesale market logistics appear successively.In contractual logistics，farmers provide fresh agricultural products，while cooperatives or processing enterprises are responsible for entering market；in wholesale market logistics，wholesale market is center and responsible for sales of agricultural products.Product wholesale market logistics has become wholesale market network system integrating three fresh agricultural products，and become major form of logistics of fresh agricultural products in Guangxi.It radiates to Hong Kong，Association of South-East Asian Nations（ASEAN）and other regions.By the end of 2011，there were 105 agricultural products wholesale markets in Guangxi with number of workers up to 186581；in 2011，the turnover reached 39.34393 billion yuan，including 44 wholesale market having annual turnover more than 100 million yuan，the largest is Yulin City Hongjin Agri-Products Wholesale Market Group Limited having turnover up to 4.2 billion yuan.

3 Existing problems

3.1 Some traditional fresh agricultural products are not selling well and there is no supply chain of fresh agricultural productsIn recent years，some fresh agricultural products in Guangxi sell poorly.In 2008，the wholesale price of longan in Wuming County was 2.0－2.4 yuan／kg，lower than the previous year for 60%，60000 tons were dull of sales［9］；in 2009，the wholesale price of banana was as low as0.2－0.8 kg／yuan，lower than previous year about 57.9－89.5%，about 1 million tons of banana were dull of sales；in 2011，litchi and longan purchasing price in Beiliu was1.0－2.0 yuan／kg，lower than previous year for 50.0－70.0%，about100000 tons were dull of sales；in 2011，oranges in Longsheng County were dull of sales about24000 tons，and annual dull sales of orange in Fangchenggang City reached 2 million kg.

Lack of supply chain of fresh agricultural products is a key reason for unsmooth salesof some traditional agricultural products.At present，there aremainly5 channels for fresh agricultural products in Guangxi from producers to consumers，as shown in Fig.1.By now，there is no enterprise connecting production，processing，storage and transport，sales and consumption in an effective way.In other words，there is no supply chain of agricultural products.At present，the wholesale market logistics still takes the leading position in logistics of fresh agricultural products in Guangxi.From the perspective of management of supply chain，the wholesale market logistics can be considered as industrial chain consisting of producers，purchasers，wholesale markets，distributors，and consumers.It can be divided into two short chains：from farmer households to wholesale market（production-circulation）and from wholesale market to consumers（circulation-consumption）.Inside these two chains，it should form＂competition-cooperation-coordination＂relation.However，at the connection of these two short chains，the wholesale market，there is the market transaction form with competition as major form.As a result，information flow between production and consumption fails to be well connected orgets blocked，leading to supply information from consumers to suppliers and from suppliers to consumers failure to smoothly reach the counterpart or even get twisted.In consequence，both short chains are inefficient.In addition，China's agricultural product wholesale market still takes real-time delivery versus payment as major transaction form［10］.Such transaction form determines that there is merely competition relation，but no cooperation and coordination relation，and it has to pursue immediate interest but not possible to pursue long-term benefit［11］.Blockage of information flow leads to information asymmetry.For farmers，due to uncertainty of demand information，blindness of planting increases and market risk also increases，which are not favorable for balancing supply and demand of agricultural products.For consumers，due to uncertainty of supply information，there is no adequate information about product quality.As a result，consumers lose trust in product quality，it leads to market failure.In other words，low quality productswill expel high quality products from market.Therefore，in the circulation system with traditional wholesale market as center，the industrial chain is a broken short chain，and the result is irregular occurrence of slow sales of agricultural products.

3.2 The construction of logistics information system lags behind for fresh agricultural productsAt present，most rural areas of Guangxi have notestablished agricultural product information platform.They fail to share logistics information with logistics enterprises or customers.This becomes a serious obstacle for sustainable development of fresh agricultural products.Farmers acquire information many through mass media，such as TV，television station，and newspaper，seldom through local market，government organs，and specialized information service institutions.Many fresh agricultural product markets are not provided with information facilities，and related logistics information network system is still in blank.In the survey of40 logistics service enterprises in Anji of Nanjing，North Freight Station and West Freight Station Logistics Park，100%enterprises have computers，95%enterprises have Internet，but limited to access of public network service，only 55%enterprises have their own logistics information system，but most logistics service enterprises are incapable of processing logistics information using modern information technology，and there is still no supply chain information system for agricultural products.The lagging of construction of logistics information system seriously restricts development of fresh agricultural products in Guangxi.

3.3 Organizational level of production and operation of fresh agricultural products is low（i）Operation is decentralized.71%fruit farmers have orchard area below 0.13 ha and only 1.2%fruit farmers have orchard area greater than 3.33 ha.（ii）Specialized cooperatives fail to fully attract farmers to join in.In the household contract responsibility system，developing specialized cooperatives is a measure for improving organizational level of production and operation，but the present situation is not optimistic.Only for agricultural product producers in industrial chain of fresh agricultural products，there were 11674 farmers specialized cooperatives in Guangxi，ranking the 23rd place in the whole country， lower than neighboring Yunnan， Guangdong， and Guizhou.660000 households joined in cooperatives，accounting for 6.22%of total households joining in cooperatives，lower than the national average level（12.00%）for 48.17%of March，2011.This indicates that most producers of fresh agricultural products in Guangxi rural areas remain outside the supply chain and fail to operate logistics in accordance with modern logistics marketing concept.Direct consequence of poor connection is that enterprises have to complete certain segment of fresh agricultural products logistics according to their own conditions or advantages，such as single transport，storage，and packaging.The entire logistics process is split to several segments by different logistics entities and they lack planning for production，operation，and safe consumption of fresh agricultural products.

4 Recommendations

4.1 Strengthening policy and financial supportThe difference between supply chain of agricultural products and other consumer goods lies in strong independence of segment enterprises and separate management.Therefore，government should provide relevant support to coordinate benefits of all interested parties，to effectively improve operation effect of supply chain，and reduce social costs.Firstly，it is required to strive for obtaining state support and cooperation with other provinces and cities，make planning for connection of sales and production of agricultural products，and fully explore regional advantages.Secondly，government should issue guidance documents for smooth and effective connection of upstream，midstream and downstream of logistics of fresh agricultural products，strengthen adjustment of land use，taxation，and benefit allocation，encourage and support upstream，midstream and downstream enterprises to establish long-term strategic cooperative partnership，and build supply chain of fresh agricultural products，reduce product loss，and increase logistics benefits.Thirdly，it is recommended to establish multi-part joint mechanism with participation of government，industrial organizations，enterprises，and farmers，herdsmen，and fishermen，to promptly solve various problems in development of supply chain of fresh agricultural products.Fourthly，government should organize to formulate corresponding support policies，strengthen financial support，guide and help enterprises，especially core enterprises in the supply chain to establish information system，and add fresh agricultural product cold chain facilities and equipment，and transform wholesale market.Financial department should increase credit input to logistics of fresh agricultural products and solve the problem of difficult financing.

4.2 Building and managing supply chain of fresh agricultural products for GuangxiIn 2012，there were 5136 transportation，warehousing，and postal enterprises in Guangxi.However，due to seasonal and long period of fresh agricultural products，few enterprises are engaged in logistics of fresh agricultural products.This increases difficulty in building and managing supply chain of fresh agricultural products for Guangxi.In the first place，it is recommended to select，support and cultivate suitable enterprises to become core enterprises of fresh agricultural products in the supply chain.Besides，at technical level，it is required to develop and use suitable supply chain information system，to closely connect participants，realize smooth connection of production，supply and sales of agricultural products，realize real-time sharing，avoid blind production，operation and consumption，and facilitate segments of supply chain to perform their duties.Thirdly，it is recommended to coordinate segment enterprises in the supply chain，solve problems of rights，responsibilities，duties，and confidentiality of enterprises，and promote enterprises to establish stable partnership.Finally，government should lead or entrust industrial associations to organize forces to formulate operation standards for supply chain of fresh agricultural products，such as product handling process and evaluation of supply chain performance，to promote healthy development of supply chain of agricultural products.

4.3 Improving organizational level of production and operation of fresh agricultural productsFirstly，it is recommended to promote change from family operation of using traditional production and management technology to intensive management of using advanced science and technology and production means，increase input of technologies，capitals，and other production elements，to raise intensification level of production and operation of logistics of fresh agricultural products.Secondly，it is recommended to continue strengthening cooperation of farmer households，to establish diversified，multi-level and multi-form operation and service system.Also，it is recommended to cultivate industrial leading and train new farmers，closely connect industrial chain through promotion of leading enterprises，jointaction of specialized cooperatives，and farmers，upgrade industrial chain to supply chain，and well organize farmers，to realize integration of production，industry，sales，and service，benefit sharing，work division and cooperation，and risk sharing.

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