China's NDRC vows to stabilize hog prices by cracking down on price gouging
Global Times

Photo: China News Service

China's top economic planner, the National Development and Reform Commission (NDRC), has vowed to keep pig prices stable and crack down on price gouging at a meeting with major pig breeders on Monday, in response to soaring hog prices.

Pork prices in China have gone up recently. A most-active future contract on the Dalian Commodity Exchange jumped almost 8 percent on Monday to close at 22,695 yuan ($3,390) per ton, up 40 percent over its low in mid-March.

On Friday, the average pork price tracked by the Ministry of Agriculture and Rural Affairs was 24.55 yuan per kilogram, up 12.9 percent from the previous week.

The NDRC attributed the price surge to irrational hog hoarding and over-fattening among breeders on fabricated media reports about exaggerated price rises and demand shortage.

The NDRC noted that China's current hog production capacity is abundant and within reasonable range, and the demand for pork consumption is stable. "Therefore, pig prices do not have a basis for a sustained and substantial rise," the NDRC said.

The economic planner has required livestock farms and households not to hoard or collude in raising prices so as to maintain the stability of hog production capacity, stressing that effective measures such as adjusting the central reserve will be taken at an appropriate time to prevent the price of hogs from rising too quickly.

The NDRC also vowed that it will work with relevant departments to strengthen market supervision and severely punish illegal activities such as fabricating and spreading misinformation on price rises and price gouging to maintain normal market order and promote the long-term healthy development of the industry.

Participants at the meeting said that they would strengthen self-discipline and make reasonable decisions over production and operations to maintain the stability of hog production capacity, according to the NDRC.

Top producer Muyuan Foods said in a statement on Monday that this round of pig price rise is mainly driven by the marginal improvement of supply and demand.

The company sold 5.27 million pigs, with sales revenue hitting 8.75 billion yuan in June. The average selling price of pigs in the company rose to 16.53 yuan per kilogram in June, up 11.16 percent from the previous month.