China Adds to Pork Reserves to Stabilise Prices
CHINA - 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.
8 May 2014
2 minute read
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 30 April, 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.
