Affected by low profitability of food crops, non-grain production has
put a threat on Chinese food security. Though widely discussed, its
impact on land rent has not been fully studied. This study explores the
spillover effect of non-grain production from the perspective of factor
opportunity cost. Data are extracted from 273 plots in Jiangsu province,
China. Outcomes show that non-grain production significantly increases
the land rent of surrounding plots by 222.02yuan/mu. This spillover
effect exhibits a stronger trend as contracted land scale expands.
However, the kin relationship among contract parties can weaken this
effect, which points out that social ties can work as a mediator in
resisting the external shock of non-grain production. Similarly, guided
price set by governments is an indicator when land rent reaches an
unreasonable level and hinders grain production. Far from being a
spontaneous process of pure market forces, rural land use is actively
harnessed by government at all levels. Hence, the study recommends a
comprehensive land use plan and regional regulated land transfer market
in order to achieve a balance between food security and diversified
agricultural structure. Restrictions should not be imposed on the
informal land transfer among acquaintances.