In this file:
· SCMP:China’s pork prices starting to ‘scare’ consumers as discontent soars
… “Comrades, pork prices really scare me!” a customer in his 60s yells to the crowd, with another responding: “A few days ago when I came here, the price of ribs was 16 yuan for half a kilo. Today it’s 25 yuan”… The sharp drop in supply caused pork prices to soar and is now a growing source of public discontent, with Beijing responding by rolling out a series of emergency remedies…
· SCMP: Hong Kong protests and US trade war no longer China’s top priorities as spiralling pork prices dominate agenda
… Environment Minister Li Ganjie said last week that it is “a critical political task now to safeguard live hog production and ensure pork supply”… Other government agencies, from the Ministry of Transportation to the China Banking and Insurance Regulatory Commission, have also been mobilised to help boost the supply of pork. The banking regulator has told banks not to turn down any loan applications from a pig farm, while highway toll fees will be waived for trucks carrying pigs or frozen pork…
· NYT: China’s Pork Prices Soar, Adding to Beijing’s Troubles
… China’s premier, Li Keqiang, and the country’s top governing body have called for “an attitude of urgency” to deal with the issue. Another top official last month labeled the problem a “national priority.” At least three local governments have tapped the country’s strategic pork reserves to ensure that consumers can keep eating the meat without breaking the bank, according to local news reports…
· In countdown to trade war talks, China ready to sweeten deal by buying American goods, source says
... China is expected to agree to buy more American agricultural products in hopes of a better trade deal with the United States as the two nations prepare for a meeting between their top negotiators next month...
· China reports new African swine fever case in Ningxia
China’s pork prices starting to ‘scare’ consumers as discontent soars
· Across China, prices have doubled since July, reaching record highs of 30 to 33 yuan per kilogram, surpassing analyst expectations
· Beijing has implemented policies to offset increases but it is expected to take years to restore stocks after African swine fever outbreak led to 1 million pigs being culled
Orange Wang & Kathleen Magramo, South China Morning Post (SCMP) [China]
8 Sep, 2019
As is the case across China, complaints about rising pork prices are constant and loud in Xinfadi, the biggest meat market in Beijing.
“Comrades, pork prices really scare me!” a customer in his 60s yells to the crowd, with another responding: “A few days ago when I came here, the price of ribs was 16 yuan for half a kilo. Today it’s 25 yuan.”
The irony, and possibly the cause for the concern, is that Xinfadi mainly deals with wholesale buyers but also sells directly to consumers, offering the lowest pork prices in the capital city.
Prices for food products, especially pork, are one of the major indicators used by Chinese citizens to informally gauge their financial well-being, and at the moment, that well-being is being eroded rapidly.
Across China, pork prices have doubled since July, reaching record highs of 30 yuan (US$4.20) to 33 yuan per kilogram, surpassing analyst expectations. The last time pork prices reached similar levels, in June 2016, they peaked at 31.56 yuan per kilogram, according to the Ministry of Agriculture and Rural Affairs.
But on this occasion, prices are expected to continue to rise until the end of the year and into the Lunar New Year holiday season at the end of January, when pork is traditionally at the centre of family feasts. And while the government is implementing policies to offset the price increases, it will take years to build the supply of pigs back up to their previous levels after the outbreak of African swine fever in August led to the culling of hundreds of thousands of pigs and breeding stock to stop the spread of the virus, analysts said.
Last week, a video of a group of shoppers fighting over a large piece of fresh pork during the opening of American warehouse retailer Costco’s first store in Shanghai went viral across Chinese social media.
In July, China’s live pig stock stood 32.3 per cent below a year earlier, according to data from the Ministry of Agriculture and Rural Affairs, after the African swine fever epidemic forced the country to slaughter at least 1 million pigs.
Pork is by far the most popular meat consumed in China, and data from Beijing-based financial news outlet Caixin shows that each person in China consumes about 55kg of it every year.
The sharp drop in supply caused pork prices to soar and is now a growing source of public discontent, with Beijing responding by rolling out a series of emergency remedies.
One such remedy would reverse a 2016 policy that restricted pig breeding in eight southern provinces to large farms and closed more than 150,000 smaller farms to increase efficiency and protect the environment.
At a cabinet meeting in August, Premier Li Keqiang ordered local governments to stop demolishing small pig farms while also lifting restrictions on small-scale pig farming in the countryside.
Li also told local governments to provide subsidies to large pig farms to “effectively increase the population of live hogs”, while also setting local pig quotas.
But around three years of moves to eliminate smaller farms has also led to discontent, with one article about the policy change published on WeChat after Li’s speech generating over 100,000 largely negative views in 24 hours.
“We won’t breed [pigs] any more, even if there is compensation and support,” one online user wrote in a typical response to the article. “I had to bury [dead pigs] by myself due to African swine fever this year, without a penny of subsidies. I’m nearly bankrupt, how can I raise pigs again?
“I invested millions of yuan to build a pig farm in 2000, but [they] demolished it in 2018, [and only] gave me 100,000 yuan as compensation. Now I am 60 years old but have to carry cement at a construction site [to make money], with a lot of debts to be paid off.”
In the near-term, lower supply – exacerbated by the trade war with the United States – will mean higher prices.
“Given the situation, we can expect the price to continue to go up and at the same time, consumption to go down,” said Chenjun Pan, senior analyst for animal protein at Rabobank. “This basic mechanism will help to slow down the rise in pork prices.”
The ongoing trade war with the US adds another element to upwards pressure on food prices. On September 1, China imposed an additional 10 per cent tariff on US farm imports, resulting in a 72 per cent duty for imported US pork. China also recently cancelled a large purchase of 14,700 metric tonnes of US pork, according to data from the US Department of Agriculture.
“American pork imports account for less than 0.2 per cent of Chinese output, so the trade dispute with the United States will have no impact on pork supply and pork prices in China,” Xin Guochang from the Ministry of Agriculture and Rural Affairs told state-run CCTV two days before the additional tariff was imposed.
Beijing is also taking steps to increase the supply of pork and hold down its prices with one city in the Guangxi autonomous region and two cities in Fujian province having already started offering discounts.
In Guangzhou, capital of south China’s Guangdong province, the government said it would release 16 million tonnes of frozen pork from its reserves this month at a price of 10 per cent below the market level. The meat will be sold to supermarkets, schools, cafeterias and restaurants.
It said it also planned to increase the number of pigs in the city...
Hong Kong protests and US trade war no longer China’s top priorities as spiralling pork prices dominate agenda
· Vice-Premier Hu Chunhua heading Beijing’s efforts with latest data showing pork prices rose 46.7 per cent in August compared to a year earlier
· Issue could even undermine next month’s 70th anniversary of the founding of the People’s Republic
Orange Wang, South China Morning Post (SCMP) [China]
10 Sep, 2019
Stabilising pig production amid rapidly rising pork prices has overtaken the 14-month trade war with the United States and the three months of political unrest in Hong Kong as China’s top priority, with Vice-Premier Hu Chunhua overseeing the sensitive topic that could stretch to undermining next month’s 70th anniversary of the founding of the People’s Republic.
The sharp rise in pork prices has hurt the world’s second largest economy, topped mainland media coverage and stoked outspoken public concern in recent weeks.
In response, China's State Council issued new guidelines on Tuesday urging local governments and various government departments to boost pork supply.
"Pig farming is an important industry that matters to the nation's plan and people's living. Pork is the main meat for most Chinese residents," said the State Council. “[Pork production] has significant meaning in terms of ensuring people's lives, stabilising prices, keeping stable economic operation and maintaining overall social stability.”
The consumer price index released on Tuesday reinforced the bleak picture as the data showed that pork prices rose 46.7 per cent in August compared to a year earlier, almost double the 27.0 per cent rise witnessed in July.
In the same way that Vice-Premier Liu He has been assigned to handle trade talks with the US, and Vice-Premier Han Zheng appointed to oversee the mainland’s response to the Hong Kong protests, Vice-Premier Hu’s agenda is now topped by the urgent need to control soaring pork prices.
Last week Hu, one of China’s four vice-premiers, inspected pig farms and slaughter houses from Heilongjiang province on China’s northern border with Russia to Sichuan province in the southwest, urging local governments to do whatever is necessary to increase the supply of pork.
According to a leaked document on boosting pig and pork supply seen by the South China Morning Post, Hu told a national conference on August 30 that it was not only an economic but also a political imperative to ensure a sufficient supply of pork, a staple meat on every Chinese dinner table.
“If people can’t access or be able to afford pork [in 2020], when China will become a comprehensively well-off society, it will seriously affect the achievements of a well-off society and hurt the image of the party and the state,” said Hu, according to the document.
Environment Minister Li Ganjie said last week that it is “a critical political task now to safeguard live hog production and ensure pork supply”.
The ministry is now prohibiting local governments from creating “no pig zones” in the name of environmental protection in a marked U-turn in policy after China closed hundreds of thousands of pig farms in recent years to safeguard local conditions.
Other government agencies, from the Ministry of Transportation to the China Banking and Insurance Regulatory Commission, have also been mobilised to help boost the supply of pork. The banking regulator has told banks not to turn down any loan applications from a pig farm, while highway toll fees will be waived for trucks carrying pigs or frozen pork.
China’s National Development and Reform Commission, the economic planner, said on Monday that it will provide subsidies of up to 5 million yuan (US$700,000) to any pig farm that seeks to rebuild or expand existing facilities or relocate from areas where breeding is still forbidden due to African swine fever.
Beijing’s scramble comes a time when the price of pork in many places has doubled in August alone thanks to a plunge in supply, causing a loud public outcry.
There were 69 times more mainland media articles related to “pork” than “China-US trade” as of the end of last week, according to the Baidu Index, a Chinese online search tracking service equivalent to Google Trends…
China’s Pork Prices Soar, Adding to Beijing’s Troubles
Chinese grocery bills were already rising because of the trade war. Officials are now calling for ‘an attitude of urgency.’
By Alexandra Stevenson and Raymond Zhong, The New York Times
Sept. 10, 2019
BEIJING — Things that keep China’s top leaders up at night: a stalling economy, a bruising trade war and, increasingly, pigs.
Specifically, a shortage of pigs, which is fast becoming a national crisis.
The price of pork has been rising for months and is now nearly 50 percent higher than a year ago, data published on Tuesday showed. Consumers are frustrated, and officials are quietly expressing alarm as they fight the outbreak of a disease that is devastating the country’s pork supply.
China’s premier, Li Keqiang, and the country’s top governing body have called for “an attitude of urgency” to deal with the issue. Another top official last month labeled the problem a “national priority.” At least three local governments have tapped the country’s strategic pork reserves to ensure that consumers can keep eating the meat without breaking the bank, according to local news reports.
(Yes, China has strategic pork reserves. Pork is that important here.)
Even with these measures, consumers are being hit hard at a time when grocery bills are already going up thanks to the trade war with the United States.
“Too expensive, too expensive, too expensive! We can’t afford it,” said Gui Fuyi, a 69-year-old retiree who was browsing the meat section of a Beijing supermarket on Tuesday. These days, Ms. Gui buys only ground pork for wrapping into dumplings, not whole cuts.
China on Tuesday released consumer price inflation figures that illustrated the growing burden on shoppers. Food costs rose by 10 percent in the past year, the numbers showed, an increase made worse by trade tensions that have resulted in steep tariffs on agricultural products and livestock feed from the United States.
“The Chinese government always likes to say that China can tolerate any pain and repercussions from the trade conflict,” said Victor Shih, an associate professor at the University of California, San Diego, and an expert on the Chinese economy. “But what they neglect to say is that it is the people who are bearing the brunt of the pain.”
China has publicly said that the trade war with the United States will not impact its pork supply. But with the most recent tariffs, which came into effect on Sept. 1, China now imposes extra taxes on American products including soybeans, pork, seafood and crude oil.
As officials brace for steeper price increases — analysts are estimating that pork prices could end the year at double their level from 2018 — the challenge for Beijing is becoming more serious.
For more than a year now, China has fought to contain a vicious epidemic of African swine fever, a highly contagious disease that is harmless to humans but kills nearly every pig it infects. The Chinese government declared its first outbreak in August 2018, and since then cases have been reported in all of the country’s provinces.
In response, the authorities have ordered farmers not to feed pigs kitchen waste, a major channel through which the disease, which can survive for days in feces and uncooked meat, has spread to healthy populations. Officials have imposed quarantines and transport restrictions in places where the disease has been found. The police have arrested people for trading infected pigs.
But safety and hygiene standards have been tough to enforce across the millions of small backyard farms where most of China’s swine are raised. The government says that 1.2 million pigs have been culled so far to try to halt the disease’s spread, which is a tiny fraction of the 700 million pigs that were slaughtered in China last year.
Many livestock analysts say the official numbers do not begin to capture the seriousness of the epidemic.
Farmers and industry observers in China say that large numbers of African swine fever cases have gone unreported to the authorities, and that many infected pigs end up sold into the market as a result. In some instances, farmers say, local officials have been slow or reluctant to acknowledge infections found in their herds.
The disease has already crossed the Chinese border into Vietnam, Mongolia and North Korea. Other Asian countries are on high alert.
As pork prices rise and Chinese families prepare for several big holidays, local officials have started to find creative ways to try to tamp down anxieties...
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In countdown to trade war talks, China ready to sweeten deal by buying American goods, source says
Top negotiators to meet in Washington early next month but even a simple purchase agreement is no certainty, observers say
Wendy Wu, South China Morning Post (SCMP)
10 Sep, 2019
China is expected to agree to buy more American agricultural products in hopes of a better trade deal with the United States as the two nations prepare for a meeting between their top negotiators next month.
A source familiar with the situation said working-level officials were discussing the text of a deal, which would be reviewed when Chinese Vice-Premier Liu He met US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin in Washington in October.
The text is based on a draft the two sides negotiated in April, the source said on condition of anonymity.
As part of the discussions, China has offered to buy American products in exchange for a delay in a series of US tariffs and easing of a supply ban against Chinese telecommunications giant Huawei Technologies.
The source said China could also offer more market access, better protection for intellectual property and to cut excess industrial capacity, but would be more reluctant to compromise on subsidies, industrial policy and reform of state-owned enterprises.
With the talks just weeks away, Chinese leaders are trying to enlist support from the business community.
Chinese Premier Li Keqiang told a gathering of US business representatives on Tuesday that China wanted a mutually accepted solution to the trade dispute. Li also said China welcomed investment by US companies in China, and that the country’s opening and reform would continue.
In a separate meeting with Citigroup CEO Michael Corbat, Liu said China firmly opposed the trade war and hoped the US business community would help foster stable and cooperative bilateral trade and economic relations.
Trade talks collapsed in early May despite agreement on nearly 90 per cent of a text for a trade deal, including a currency agreement, sources said.
In the aftermath, the US accused China of backtracking on previously agreed promises, while Beijing said the text raised unacceptable demands and hurt its sovereignty.
The talks resumed in July but failed to bring any meaningful results in a shorter-than-expected meeting in Shanghai.
Observers said the US wanted to resume talks based on an earlier text but China insisted that any deal must first include the removal of tariffs...
China reports new African swine fever case in Ningxia
Reporting by Dominique Patton, editing by Louise Heavens, Reuters
Sep 10, 2019
BEIJING, Sept 10 (Reuters) - China’s Ministry of Agriculture and Rural Affairs reported a new case of African swine fever on a farm in the northwestern region of Ningxia on Tuesday.
The farm, in a district of Yinchuan city, had 226 pigs and 13 had already died of the disease, it said.
China, the world’s top pork producer, has seen its hog herd...