Grain prices surge - first time in six years ( 2003-10-22 00:54) (China Daily)
Grain prices in China have risen - dramatically - for the first time in six
years.
Wheat prices in Northeast China's Heilongjiang Province
rose by 32 per cent to 1,100 yuan (US$132.50) per ton, according to a Xinhua
News report.
Customers purchase
rice at a supermarket in Beijing.
[newsphoto.com.cn/file]
Paddy rice prices in East China's Anhui Province reached 1,050 yuan (US$126)
per ton, up 80 yuan (US$9.60) to 120 yuan (US$14.50) over the same period last
year. And maize prices in Hebei and Shandong provinces also went up by 50 yuan
(US$6) to 70 yuan (US$8) per ton, according to the report.
The grain price increases also drove up the prices of edible oil, fodder and
other finished products, statistics show.
Li Chenggui, a senior researcher in rural development with the Chinese
Academy of Social Sciences, told China Daily Wednesday the prices had risen in
line with changing supply and demand in domestic and international grain
markets.
"The decrease in both agricultural production and the country's grain storage
is a major factor in the surge in grain prices," the researcher said.
"The rise in the price of grains on the international market from last year
has also contributed," he added.
Li said the jump in grain prices was good news for farmers as well as Chinese
agriculture, for it helped to rectify the relationship between producers and
consumers of grains and narrow the gap between cities and the countryside.
"The growth of per capita annual income of farmers in the country has been
slowed down since 1996 while the income of city dwellers increased rapidly over
these years," Li explained.
The growth in grain prices will also boost the prices of other agricultural
products, he said.
"It also helps to curb the drop in cropping area in the long run," the
researcher said.
China launched a campaign to restructure agriculture at the beginning of
2000, lowering its target for agricultural output.
It is the government's hope that the moves will help agricultural production
match market demand. Crop harvests over the years had led to record national
stockpiles of grain, cotton and other key products and oversupply in the market,
pulling down prices and slowing the growth of farmers' income.
The government abandoned its set prices for grain and farmers were encouraged
to diversify into products the market wanted more.
Li suggested that China should expand its grain imports to make up for the
shortage in farmland areas.
"This helps to protect our farmland resources and sustainably develop
agriculture," he said.
Li said China still has enough grain for its security needs, noting
agricultural science and technologies had bolstered the country's grain
production capacity.
But he stressed the importance of developing agriculture, since China has the
largest population in the world.
