Pork prices in China have soared to record highs in the past two weeks, adding pressure on a government trying to contain food-price inflation during the trade war with the U.S., even as the country's Producer Price index posted its first negative print in 3 years, putting China in a bind: contain soaring food inflation, or stimulate the economy and risk an angry public backlash.
Speaking to the WSJ, Darin Friedrichs, senior Asia commodity analyst, at INTL FCStone in Shanghai said "It's hard to know where prices are going to go. We're in uncharted territory." He said his own grocery bills have increased by 35% for pork belly since November and 32% for pork chops since January.
The 27% surge in pork prices - a core component of the Chinese CPI basket - lifted the headline inflation index by 0.59%. It could not have come at a worse time: due to the trade war between the US and China, Beijing's tariffs on U.S. pork have increased prices of American meat.
Traditionally, Chinese people typically eat far more pork than other meat; in fact China is the single biggest consumer of pork in the world.
As pork prices rise to levels that are prohibitively high for many, consumers are changing their buying habits, pushing up prices for other meat.
"I've never seen anything like this," said Xiao Tong, a vendor who has been selling pork for nearly 20 years in Beijing.
Beijing levied new tariffs totaling 50% on pork from the U.S. last year and in June suspended pork imports from Canada.
https://www.zerohedge.com/news/2019-08-29/ive-never-seen-anything-china-reels-pork-prices-explode-record-levels
Speaking to the WSJ, Darin Friedrichs, senior Asia commodity analyst, at INTL FCStone in Shanghai said "It's hard to know where prices are going to go. We're in uncharted territory." He said his own grocery bills have increased by 35% for pork belly since November and 32% for pork chops since January.
The 27% surge in pork prices - a core component of the Chinese CPI basket - lifted the headline inflation index by 0.59%. It could not have come at a worse time: due to the trade war between the US and China, Beijing's tariffs on U.S. pork have increased prices of American meat.
Traditionally, Chinese people typically eat far more pork than other meat; in fact China is the single biggest consumer of pork in the world.
As pork prices rise to levels that are prohibitively high for many, consumers are changing their buying habits, pushing up prices for other meat.
"I've never seen anything like this," said Xiao Tong, a vendor who has been selling pork for nearly 20 years in Beijing.
Beijing levied new tariffs totaling 50% on pork from the U.S. last year and in June suspended pork imports from Canada.
https://www.zerohedge.com/news/2019-08-29/ive-never-seen-anything-china-reels-pork-prices-explode-record-levels
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