Pork price in China averaged 26.79 yuan per kilogram in the week ended June 26, falling 0.7% on a month-on-month basis but 32.7% higher compared with the same period last year, according to data from the Ministry of Agriculture.
Indeed, average hog price, or live pig price, across the country has fallen below the 20 yuan/kg mark in recent days, down about 5% from an all-time high in early June, according to soozhu.com, a pig price monitor website.
Wang Zhenxia, an expert with the Chinese Academy of Social Sciences (CASS), said that the fallen hog price will continue to drive down retail pork price, pointing out that consumer price inflation (CPI) is expected to remain stable in the second half of the year.
Pork price accounts for a large weight of China’s CPI calculation. Last month, pork price surged 33.6% from a year earlier, making a 0.77 percentage point contribution to a 2% CPI growth in the month. Therefore, a fallen pork price will likely curb the nations’ CPI growth.
Analysts at Bank of Communications, China’s fifth state-own bank, said in a note dated June 29 that they expect CPI to rise 1.9% year on year this month due to a milder-than-expected increase in food prices.
Additionally, according to the CASS, China’s economy will grow at about 6.6% this year, and CPI will likely rise 2%.