Analysis: China's food prices to rise steadily in 2009(1)
BEIJING, April 9 (Xinhua) ? China's food prices are expected rise steadily throughout 2009, driven by changing situations in the domestic and international markets.
China's food security in 2009 will be guaranteed by the country's regulatory measures.
First of all, China's self-sufficiency food policy helps stabilizing food prices in China. Except some high-quality products, about 90 percent of foodstuff consumed in China is produced by the country itself.
Chinese Premier Wen Jiaobao said in April 2008 that China's food storage then amounted to 150 million to 200 million tons, doubling the world's average storage volume. In general, China's food market is balanced.
Second, China's farmers enjoyed bumper harvests five years in a row, further balancing the country's food supply and demand.
The total food output in China during 2008 is estimated to hit 525 million tons, up 4.7 percent over the previous year. In addition, China's major food products, except soybeans, recorded a decreased import volume in 2007. Net export volume grew 2.4 times to 8.31 million tons. Average import price of paddy and rice went up 16.7 percent in 2007, and that of wheat hiked by 47.2 percent.
Thanks to the low export dependency rate, the international food price increase had less of a negative impact on the Chinese market in 2008.
However, China's soybeans have had an export dependency rate exceeding 70 percent. Its prices rose along with international prices in 2008, and pushed up China's edible oil prices. Custom statistics show that China imported 30.82 million tons of soybeans in the first 10 months of 2008, exceeding the yearly volume in 2007.
Third, China's food policies support the food supply in the domestic market.
China stresses the maintenance of arable land at 1.8 billion mu (120 million hectares), subsidizes grain producers, lifts the minimum purchase prices of grains to encourage farmers and bolsters the market with a sufficient food supply.
In China, barring serious natural disasters, the country will be able to enjoy a highly secure food market in 2009. However, experts call for attention to be paid to long run food security.
-- International environment of food security in 2009
First, the deepening global financial crisis in 2009 is challenging the world's food safety.
World Bank statistics show that global undernourishment population grew 44 million to a total 967 million in 2008 as the economic wobbling negatively impacted food production and consumption.
Many major food producers, such as the U.S. and some European countries, were hard hit by the credit crunch, which made it harder for farmers to finance food production and added to the uncertainty of the food market.
The financial crisis slowed economic growth in developing countries, and for the first time since 1982 shrunk global trade. Under these circumstances, people are more inclined to consume provisions rather than meat, aggravating unbalanced supply and demand of food products.
Secondly, food inventories worldwide also stand at a historic low.
