China's efforts to curb rising pork prices and to crack down on market misconduct and irregularities will help stabilize the market and keep overall prices within a reasonable range this year, according to experts.
They believe China is capable of meeting its annual target of 3 percent consumer inflation for 2022, which leaves room for more policy stimulus to shore up growth.
The National Development and Reform Commission, the country's top economic regulator, said on Tuesday that it is considering releasing pork from central reserves and guiding localities to release extra stocks in a timely manner to prevent sharp increases in hog prices.
In the past few weeks, the prices of pork, a staple meat in China, have been rising. The ministry of agriculture and rural affairs said on Wednesday the average wholesale price of pork in China rose to 28.51 yuan $4.25 per kilogram, up 6.8 percent from a day earlier and 27 percent from a year ago.
Liu Zhicheng, director of the commodity market division at the Chinese Academy of Macroeconomic Research's market and price institute, said at a symposium held by the National Development and Reform Commission on Wednesday that China is the world's largest producer and consumer of pork. Price stability in the pork and hog markets will help keep prices reasonable and ensure stable economic operations.
Liu blamed recent hog price hikes on factors including some producers' reluctance to sell hogs that are ready for the market.
A research fellow at the Ministry of Agriculture and Rural Affairs' Institute of Food and Nutrition Development, Zhou Lin said recent price rises were a result of multiple factors, including a bullish mood about rising hog prices, transportation disruptions due to heavy rains and a fall in imports.
Despite the recent price hikes, Liu said there is not enough room for further hog price gains in the coming months due to factors such as China's sufficient supply of hogs, slowing pork consumption in July and August and recent pig feed price declines.
He said that China is capable of meeting its consumer inflation target for 2022, and the government will take solid steps to stabilize supplies and prices.
The overall price level of China is within a controllable range compared to the soaring prices in other major economies.
China's consumer price index, the main gauge of inflation, rose 2.1 percent year-on-year in May, unchanged from April, according to the National Bureau of Statistics. Inflation hit a 40 year high in the United States in May as the CPI there rose 8.6 percent year-on-year, according to official figures.
The NBS said China's producer price index, which measures factory-gate prices, increased by 6.4 percent year-on-year in May, the slowest pace since March 2021.
Yin Yue, an analyst at Shanghai-listed Hongta Securities, said that China's relatively stable inflation level leaves plenty of room for more policy to prop up growth.
The NDRC's Department of Price recently held a symposium with the Dalian Commodity Exchange to examine efforts to ensure stable supplies and prices in the live hog market, the commission said in a statement on Tuesday.
The NDRC said that the two sides will work with relevant parties to strengthen the regulation of the futures and spot markets, and crack down on illegalities and irregularities such as spreading false information, hoarding, price gouging and speculation in the market to maintain normal market order.