May 12, 2009

China has earmarked RMB3 billion (US$439 million) this year to support the large-scale breeding of pigs and cows in order to stabilise agricultural development and help raise farmers' incomes, the State Council said Sunday (May 10).

 

The Cabinet has urged governments at all levels to put into effect all subsidies and stimulus policies regarding pig and cow breeding.

 

The central government's announcement of the investment will help stabilise pork prices amid fears of the AH1N1 flu, said Zhang Xiaoshan, director of the rural development research institute of the Chinese Academy of Social Sciences.

 

Earlier this month, pork prices in three of the biggest markets in south China's Guangzhou dropped sharply.

 

Statistics released by the National Development and Reform Commission (NDRC) last week showed pork prices in major Chinese cities averaged RMB10.13 (US$1.5) per kg at the end of April, down 10.4 percent from the same period last year.

 

Since pork available in domestic markets mostly comes from large-scale breeding farms, the price would automatically stabilise once the government implements the subsidy and stimulus policies, Zhang said.

 

The central government promised to double the subsidy to RMB100 (US$14.6) for every fertile sow since July 2008.

 

The State Council further said it plans to build a grain reserve capacity of 15 million tonnes, oil reserve of 1.75 million tonnes, sugar reserve of 400,000 tonnes, and cotton reserve of 500,000 tonnes within two years.