We know of the high prices and short supply of pork and eggs. The new farm commodity to watch is grain following the storms and floods. The Agriculture Ministry has warned that it will be difficult to stabilize supplies this autumn. That could suggest that government maintained stocks are low (stock levels are a closely kept secret). Another straw in the wind: Taiwan says that it won’t be able to import China’s wheat to keep down prices on the island because China will be importing itself.
The price of wheat on the world market is been at an 11-year high. The global balance between supply and demand is tightening because of wet weather in Europe and the demand for biofuel feed-stocks in the U.S. China is one of the world’s leading wheat producers. Since 2003 it has switched from being a net exporter to a net exporter. Here by way of background is a speech given in Beijing this month by Gerald A. Bange, the USDA’s chief economist.
Any rise in grain prices is another unwanted push on the inflation pump.
A tip of this Bystander’s tifter to the China Law Blog, for being the first publicly to notice this blog. Time will judge quite how inconsequential a footnote to history that is, but meanwhile, I appreciate your encouraging words.