Effectiveness of Agricultural Water Pricing on Solving the Water Shortage of North China Plain: A Case study in Fengqiu County of Henan Province
农业水价调整对解决华北平原水资源短缺的有效性分析

The potential to use water pricing instrument to influence agricultural irrigation practices on North China Plain was studied with a simple analytical model and a questionnaire survey.The study was carried out in Fengqiu County, Henan Province,where comprehensive and long term bio-physical research on water dynamics has been conducted.The results from the analytical model showed that the water price elasticity was very low,at current irrigation techniques.When the agricultural price was increased from the current value of 0.10 Yuan/m~3 to the supply cost recovery one of 0.20 Yuan/m~3,the potential water saving is increased only by 6.7%.However,the farmer income loss would be 230 Yuan/hm~2.In another words,increasing the water price can not save water at the current market grain price. The results from farmers' survey showed that grain self-sufficiency was the most important factor that farmers consider when they decided what to plant,when and how much to irrigate.The farmers' responses to water price increase were of rigidity as over 60% farmers would follow current irrigation pattern till they are unable to afford it.The survey also showed that farmer' perceptions of water scarcity and environmental pollution was very poor,about 80% farmers did not care or did not know the importance of irrigation use efficiency and environmental pollution caused from excessive water use.Another reason for low water price elasticity is the low profit margin.The annual average income per capita was only 2026 Yuan,in which about one third came from the cropping production.If the labour cost was incorporated into the input cost,farmers' net income from cropping was only about 200 Yuan.Therefore the main constraints for the effectiveness of agricultural water pricing to solve the problem of water shortage in the North China Plain are summarized:1) lack of awareness of water scarcity and environmental pollution by farmers;2) very low farm profit margin;3) the main reason for farming,essentially a subsistence farming rather than income oriented.Two measures were recommended to alleviate the water shortage in the North China Plain:1) changing area-based charge system into simple volumetric-based one and small increase of water price and 2) setting up the water price system of "two-part tariff plus government subsidization".