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With the deepening of grain market opening and purchasing-selling marketization reforming, the government paid more and more attention to food security and gradually increased inputs on grain reserves and policy support. Besides, it continuously improved and perfected the local grain reserve management system to serve the local economic and social development, adjust the equilibrium of supply and demand for local or regional markets and ensure food security. But the local grain reserve system lags behind now, there is room for improvement. It was the loss of grain reserve rotation that has being particularly serious in recent years. How to maximize the benefit of local grain reserve rotation and turn the loss into gain became the focus of attention.After sorting many papers, this article studied the mechanism of rotation and the significance of local grain reserve operations. By analysing the local grain reserve rotation faced with market risks, policy risks, moral risks and the reserve enterprise’s internal risks, the article summarized the three factors leading to the loss of local grain reserve rotation. They were the government policies, economic factors, natural factors, as the theoretical basis of analysing LiangShan grain reserve rotation loss.Through investigating the situation of LiangShan local grain reserve system, the author had an idea of the grain reserve scale, varieties, rotation mechanism and the problems of the grain reserves management system. After further researching on LiangShan grain reserve rotation loss, combing with the general theory of local grain reserve rotation loss, the author figured out eight causes of LiangShan local grain reserve rotation loss, mainly including:limited acquisition channel, narrow sales channel, single pattern, short loan period, loan difficulty, low cost allowances, staff perceptions and internal management and unreasonable layout of storehouses.On the basis of the above analysis, drawing the examples of HuiShan district, Wuxi city and JiaoZhou city of Shandong province, local grain rotation mechanism and enterprises’ innovation success of grain rotation mode and the situations of Liang Shan grain reserve rotation system, the author proposed some solutions and countermeasures to make up for LiangShan grain reserve rotation loss from the both sides of the government and the enterprises. For the government, the author suggested to arrange rotation schedule reasonably, adjust the layout of storehouses, extend rotation period to six months to improve rotation management. The government could adjust the grain reserve rotation subsidy policy by increasing expense allowances, widening subsidy granting channels, bearing the loss of rotation. In addition, the government should improve and perfect the grain reserve loan policies and give the enterprise more autonomy. For the enterprises, the author advised to create order agriculture, direct purchasing, commissioned purchasing to broaden acquisition channels. The enterprises could expand sale channels by applying the commission rotation, processing business rotation, cooperation rotation, concentration rotation and advantage rotation.The enterprises should timely adjust a variety of rotation methods, not the single rotation way of "selling first, then purchasing". Besides, the enterprises could also be involved in futures trading, establish grain reserve rotation risk fund, create a harmonious business atmosphere, set up information network platform, and strengthen enterprises’ own management.
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