As IT firms head to the fields, farmers may lose jobs

(Ecns.cn) -- Following in the footsteps of Ding Lei, the CEO of leading Chinese web portal NetEase, more and more IT bosses are branching out into the lucrative field of agriculture.

Liu Chuanzhi, chairman of China's computer giant Lenovo, has found financial inspiration in growing vegetables, for example. "Agriculture is a very important sector," Liu tells the Southern Weekly.

Lenovo's former senior vice president Chen Zhaopeng has also transferred his talents to farming by becoming head of the modern agriculture business at Legend Holdings, Lenovo's parent company.

"The arrival of this new leadership marks a fresh strategy for our agricultural business," company spokesperson Gui Lin was quoted as saying by chinadialogue.net.

E-commerce hotshot Liu Qiangdong, CEO of 360buy.com, has also gotten in on the act. His website has carried a brand of so-called "entirely pollution-free" organic rice, which was grown in Liu's hometown in Jiangsu Province.

The list goes on. Li Zhiguo, founder of the word-of-mouth platform koubei.com, has started raising chicken and ducks; Zhu Jun, CEO of The9, a Shanghai-based online game operator, has invested in an organic farm and an online store for fresh food.

"Projects of modern agriculture, which feature large-scale operations, advanced technology and niche markets, are quite profitable," says Xiao Weizhong, partner at the Shanghai-based Qiaoshi Capital Management Company.

"Such projects have won government support and are key areas to put capital," adds Xiao, who has invested in a cattle operation in Dalian, a seaport city in Liaoning Province.

"Despite fluctuations, food prices in China are generally rising," points out Zhou Yingheng, head of the School of Economics and Management at Nanjing Agricultural University. "In other words, so long as there is capital, technology and large-scale operations, investors will harvest tidy profits."

Li Zhiguo started out in early 2011 by feeding chickens in the hills of Ningbo, Zhejiang Province. Since then, his simple farm has developed into a breeding base for a variety of poultry breeds.

Li is now reportedly investigating a vegetable garden in one of Hangzhou's neighboring cities, and may use his advantage in Internet technology to build a platform that directly connects farmers and consumers. Yet such a new and creative model has its detractors.

"Some people take farmland to build houses instead of boosting agriculture," says Zhou Yingheng, an expert on agricultural industrialization in China and Japan.

Moreover, "agricultural projects developed by large enterprises may pose great threats to farmers and the entire rural area, as they take chunks of arable land but use very little labor," Zhou adds.

Rich and powerful backers of Chinese agriculture could prove to be a double-edged sword, says chinadialogue.net.

Big business has woken up to the growth potential of organic farming. This will boost the sector, writes Yuan Ying, a reporter at the Southern Weekly, but it could also push aside small farmers.

Similar concerns exist in the United States, where organic agriculture is more mature and the industry is controlled by a small number of large firms, Yuan says.

Yuan quotes Elizabeth Henderson, one of America's earliest advocates of organic farming, who says that since discovering the profitability of the organic food market, big business has been snapping up existing farms or establishing their own.

This has created new challenges. "Organic agriculture in the U.S. faces problems, with these firms unfairly treating their workers, squeezing out small farmers and using their clout to influence organic standards," Henderson says.

The values at the heart of organic agriculture—ecological protection, health, love and justice—could be at risk as the sector scales up and becomes commercial, Yuan Ying writes.

However, "at the least the arrival of big business will have a beneficial effect on the soil and environment of the area," adds Yuan, who remains positive about the changes.