October 6, 2022

 

China to release more pork reserves as prices of the meat rise

 

 

China's state media said the country has released more pork reserves as pork prices have increased by almost a third, raising fears of inflation, AFP reported.

 

In an effort to contain costs, Beijing's top economic planner has already released frozen pork from state reserves three times this month and ordered suppliers to slaughter more swine.

 

But prices have kept rising, and officials have been forced to act because of a potential increase in demand during the week-long national day holiday in early October.

 

State media People's Daily said China will release more pork from government reserves to the market to maintain supply and price stability.

 

Based on data from OECD (Organisation for Economic Co-operation and Development), pork is the most widely consumed meat in China, where the average person consumes more than 25kg annually.

 

The National Development and Reform Commission said in a statement that from September 19 to 23, the weekly average retail price of lean meat increased by 30% in comparison to the same period last year in 36 large and medium-sized cities.

 

Despite government intervention, pork prices in the nation have risen steadily since mid-March, reaching CNY 31.17 yuan (~US$4.38; CNY 1 = US$0.14) per kilo last week.

 

Consumer inflation in China hit a two-year high of 2.7% in July, largely as a result of rising pork prices, before slightly declining to 2.5% in August as Covid-19-related restrictions reduced overall demand.

 

Large quantities of frozen pork are kept in storage by the Chinese government, which occasionally releases reserves to keep prices stable, particularly during times of high demand like Lunar New Year.

 

Beijing's central economic planner promised to further increase the distribution if necessary and to increase investments in the central pork reserves.

 

The number of breeding sows, piglets, and fattening swine is all increasing, and the domestic production capacity of live pigs is generally reasonable and sufficient, the central economic planner said.

 

The effects of a global spike in food prices brought on by Russia's conflict in Ukraine have largely been avoided by the second-largest economy in the world.

 

But after the nation's herds were decimated by African swine fever in recent years, pork prices were severely hit, leading to a rise in consumer inflation.

 

Authorities announced in 2019 that they would clear land to increase production to pre-swine fever levels. Since then, officials have released supplies from stockpiles to reduce costs.

 

-      AFP