Business / Economy

MOC downplays pork price spike

(Xinhua) Updated: 2015-08-05 09:04

BEIJING - The government has played down the recent spike in the price of pork, after concern that the costliness of China's favorite meat could have implications for monetary policy.

The number of boars and sows is still at a "relatively high level" and there will not be any obvious shortage of supply, Ministry of Commerce (MOC) spokesperson Shen Danyang said Tuesday, describing the price uptick as a normal market correction.

The price of pork surged more than 20 percent between March 20 and July 17 this year, showed MOC data, triggering speculation that the trend would push up inflation and force the government to counter with policy measures.

Food prices account for about a third of China's consumer price index (CPI), the main gauge of inflation. Pork, in particular, accounts for 2.9 percent of the CPI.

"The recent pork price increase on the whole is a correction of the sharp price decline in the past two years," Shen said at a press conference.

Before the price increase, pork prices had continuously declined over the past two years, hitting the profits of pig farmers who, in order to mitigate losses, cut down on raising. Analysts said this was an example of a typical "pork price cycle."

Shen said the MOC will keep tabs on the market and work to stabilize pork supply during upcoming public holidays and festivals.

China's general inflation has stayed tame this year. The CPI rose only 1.3 percent year on year in the first half of 2015. China's central bank said Tuesday that it will maintain a "prudent" monetary policy.

Hot Topics

Editor's Picks