By Tyler Durden
China, the world’s top consumer and pork producer, tapped its ‘strategic pork reserves’ to dump the largest amount of supplies ever into the marketplace in one month to cool prices.
A statement from the country’s economic planning agency, the National Development and Reform Commission (NDRC), indicates that the first batch of pork reserves flooded regional markets on Sept. 9. The second batch is slated for Sept. 18.
“According to the amount already put in and the plan for later release, it is expected that the country and localities will put a total of about 200,000 tons of pork reserves in September, and the amount put in a single month will reach the highest level in history,” NDRC said in a statement.
The move comes as consumer prices hit a two-year high in July with a 2.7% increase YoY, due mainly to a rebound in pork prices.
Wholesale pork prices have more than doubled since March. The good news is prices are still well below prices during the pig ebola days of 2019-20.
NDRC said the pork reserves are well supplied and have more than enough to maintain an orderly market, adding it will monitor market changes if more releases are needed.
The agency also asked farmers to increase the number of live pigs sold at markets.
A new survey via research firm Oliver Wyman found that Chinese people are beginning to complain about inflation as pork prices rise. However, inflation is not nearly anywhere compared to the US and the rest of the world.
The only thing President Xi Jinping can’t afford is discontent among the population due to rising prices … thus Beijing will continue dumping pork supplies to tame prices.
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