Business / Industries

China adds to pork reserves to stabilize prices

(Xinhua) Updated: 2014-05-07 16:52

BEIJING - The Chinese government will purchase more frozen pork from the market to stabilize prices and reduce farmers' losses, the country's top economic planning agency said on Wednesday.

The move, the second in two months, is to address the cyclical pork price fluctuation, said the National Development and Reform Commission.

A similar measure in March has proved to be effective in boosting pork prices, with the national average hog price reaching 11.14 yuan ($1.78) per kilo by April 30, ending a 19-week decline.

However, the hog-to-corn price ratio, a major indicator for the industry's profitability, stayed at 4.64:1 at the end of April, still far below the break-even point of 6:1 for farmers.

Food prices have roughly a one-third weighting in the calculation of the consumer price index, a major gauge of inflation, with pork prices being an important component.

The supportive policy is expected to ensure pork production in the long term, according to the commission.

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