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China to curb farm produce speculation

By Hao Yan (chinadaily.com.cn)
Updated: 2010-05-25 17:45

China's National Development and Reform Commission (NDRC) said Monday it will curb speculation in farm produce, prices manipulation, and supplies monopolies, and investigate criminals when severe market disruption is spotted.

The NDRC said specific definitions and punishment are currently being discussed, China Securities News reported Tuesday.

Prices hike were seen this year in rice, grain, garlic, vegetables and green beans, possibly because of the drought in Southwest China and the cold weather in Central and East. The soaring prices are also believed to have been caused in part by hoarding, market manipulation, and rumors by unscrupulous traders.

The local pricing department will keep up with the price changes in crucial agricultural products and improve the price monitoring system, said the NDRC. The abnormal price changes must be inspected and reported without delay, and temporary price intervention will be necessary in some cases. In this way, other speculations in the future could be prevented or stopped.

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The NDRC also ordered local offices to announce information about demand, supply, produce, and price changes, as well as clarify facts to stop rumors.

The rumor that garlic can help prevent infection with H1N1 helped the garlic price surges, although there is no scientific evidence for this belief, experts said earlier.

The price of garlic shot to 20 yuan per kg in Guangzhou on May 12, and garlic was priced at 13.5 yuan ($1.98) per kg in Beijing on May 13. Garlic prices in Jinxiang county, the well-known garlic growing area in East China's Shandong province, have skyrocketed since last October, when the wholesale market price hit a low of 0.15 yuan per kg.