September 4, 2007

China's inflated pork prices to continue until next year
 

China's pork prices, which have helped push inflation to a 10-year high, would not come down significantly until the second quarter of next year, an official said Tuesday (Sep 4).

Prices of pork, China's favorite meat, have been driven up in part by an outbreak of blue ear pig disease, which sometimes kills pigs and causes sows to miscarry. The government has tried to contain the spread of the disease with a massive culling and vaccination campaign.

Bi Jingquan, a vice chairman of the National Development and Reform Commission, told a press conference that pork prices will likely remain volatile until May of next year when fresh supplies are expected to reach the market.

"The price hikes should have prompted farmers to breed more pigs but it will take about 18 months for the piglets to grow into mature pigs, so I believe that we won't see a fundamental change in pork prices until the second quarter of next year," Bi said.

Inflation in the January-July period hit 3.5 percent, driven by the sizzling economy and a 15.4 percent surge in the price of pork and other food items over the year-earlier period. Consumer prices soared 5.6 percent in July over the same month last year - the highest monthly inflation rate since February 1997.

China's central bank said last week it expects the inflation rate for the year to exceed the government's 3 percent target.