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Shinan District assists to build the largest live pig insurance future project in Northwest China
Qingdao Government | NOVEMBER 16,2022

After the start of collaboration and paired assistance between the eastern and western regions in the new stage, Shinan District of Qingdao gives full play to the market advantages of Qingdao in financial service and implements live pig “insurance + future” project in Anding District of Dingxi City to reduce the pig farming market risk and promote the pig farming development in the district and to inject new impetus to rural revitalization campaign. Dingxi is a paired assistance partner of Qingdao in Western China. At present, the project is the largest live pig insurance future project in Northwest China.

Anding District of Dingxi City is strong at pig farming with live pig production of 4.5 million and 2 million plus slaughtered pig every year. As China’s pork price fluctuates and the pig farming sector has high business risk. In order to improve the guarantee system for the development of the pig farming sector and improve the ability of the sector to resist market risks, Shinan District implemented the first large-scale live pig "insurance + futures" pilot project, and invested 2.7 million Yuan in paired assistance funds and leveraged 4.5 million Yuan investment from 16 futures companies in Qingdao; Shinan District contacted Dalian Commodity Exchange and facilitated the introduction of the "Implementation Plan for Live Pig "Insurance + Futures" in Anding District of Dingxi City". The plan will cover about 120,000 live pigs, with a total premium of 9 million Yuan, The price of live pigs is insured through the futures market, making local farmers feel totally reassured.

During the implementation of the project, the farms (households) that have participated in the policy-based agricultural insurance for fattening pigs are selected as participants to join the futures insurance. The target futures market price of live pig shall be as per the future contract market price on the date when the insurance policy is issued. If the live pig futures price is lower than the target price within the insurance period, the claim settlement mechanism will be activated. The futures companies ensure the maximum benefit of the farmers, and the insurance company makes sure that the compensation will be paid to the household within the time limit.

China implemented the national policy on collaboration and paired assistance between the eastern and western regions to reduce poverty and to narrow the gaps between the eastern and western regions. Qingdao has been always taking the lead in the country in over 20 years collaboration and paired assistance and has established profound friendship with its counterparts in the western region.

In March, 2021, as per work arrangements of Party Central Committee, State Council, Party Shandong Committee and Shandong Provincial Government, Qingdao City no longer provided poverty reduction assistance to Anshun City of Guizhou Province, continued to provide paired assistance to Longnan City of Gansu Province and added Dingxi City of Gansu Province as its new collaboration and paired assistance partner. Ever since then, Qingdao continued to strengthen collaboration and cooperation with Dingxi and Longnan and made many new progress in the collaboration and paired assistance.

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