Dim Sums: Agricultural Markets in China

The food component of China's August 2026 CPI was down 1.4% year-over-year while the nonfood component was up 1.2%. The overall CPI was up 0.8% y-o-y and up 0.4% from the previous month. China's consumer prices were down year over year for most sub-categories of food, led by pork which was down 11.8%. Grains, edible oils, vegetables, and fish prices were all down from a year ago. Beef and mutton prices were up 5.3% and 6.3%, respectively, from a year ago. Egg prices were depressed last year, but they have rebounded sharply this year. August egg prices were up 15% from a year ago. China's Producer Price Index, likewise showed a 3.8% increase overall, but the PPI for agricultural processing was down 1.7%, the PPI for food manufacturing was down 1.2%, and the PPI for alcohol and beverages was down 5.3% year-over-year in August.  A commentary by a National Bureau of Statistics statistician noted that fluctuations in international prices and a seasonal change in food prices ha...

Last month this blog reported hockey-stick Chinese price increases for certain industrial commodities  since the Iran war began in late February that were as high as 40-to-77% for plastics, fuel, and chemicals. Gasoline and diesel prices eased somewhat during April, but elevated prices for sulphuric acid, liquified natural gas, and lithium persisted into the first 10 days of May. The spike in polyester prices has stimulated a rebound in cotton use, but agricultural prices are mostly insulated from the crisis so far. China's April 2026 PPI  shows a modest trend of rising prices that seems to have turned around the deflationary tendency that plagued the Chinese economy last year. The average price for industrial raw materials rose 1.2% in March 2026 and 2.1% in April. These were the first month-on-month increases exceeding 1% in the past year. A year ago at this time the raw material price index was declining--it was down -0.7% between March and April 2025.  An update of pr...

The Iran war has hit Chinese prices of chemicals and fuel hard, but most prices -- including farm prices and fertilizer -- have risen at a modest pace of 5% or less since the war began in late February. Pesticide prices have shot up in sync with the 30-to-40% increases in other chemical prices.  The impact of the Iran war is hard to discern from China's official price reports, but they indicate impacts are concentrated on fuel. The March CPI was up 1% year-over-year, but it fell 0.7% between February and March. Consumer prices for energy used for transportation stood out from all other categories with an increase of 10% in March. Producer price deflation was reversed into modest inflation. The March PPI report showed ex-factory prices rose 0.5% in March after falling 0.9% in February. Producer prices for gasoline and natural gas stood out with a 15.8% increase in March, while producer prices for consumer items were down slightly. We can discern a more precise picture of the impac...

Dozens of Chinese news reports have called attention to high tomato prices over the past month. The large number of similar reports coming out at the same time is an effort to shape public opinion about the Government's control of prices, heading off any discontent that could lead to social instability during a sensitive time.  Chinese news media are not free to report on any trend or events they deem to be important. This blog has previously discussed how China's  State-controlled media is expected to shape public opinion . The large number of articles appearing at the same time, using the same language indicates that articles on tomato prices represent a coordinated effort by propaganda authorities to address this issue.  The tomato price reports seem to have begun in mid-December with an article in  Southern Daily   noting vigorous discussion over whether vegetables have become unaffordable . Since then, dozens of articles have appeared in news outlets a...

The food component of China's CPI for September 2025 was down -4.4% from a year ago, while the nonfood component was up 0.7%, according to a report by the National Bureau of Statistics . The overall CPI was down -0.3% from a year ago. Prices were down from a year ago for most food categories. Pork (-17%), vegetables (-13.7%), and eggs (-11.9%) stood out with the largest year-over-year declines in price. Fresh fruit (-4.2%), edible oils and milk (both -1.4%) and grains (-0.7%) were also down year-over-year.  While food prices in September were down from a year ago, prices were up 0.7% from the previous month (August). Vegetables, eggs, and fruit were up from the previous month. The Food CPI is cyclical. This month's year-over-year declines reflect a reversal of increases that occurred a year ago, especially for pork and vegetables. A year ago, China's Food CPI was up +3.3% in September 2024, and it was down -3.2% in September 2023. Pork, in particular, remains highly cyclica...

U.S. news media are reporting that China's soybean boycott is driving American farmers into financial trouble, but China could have a farm crisis of its own brewing. Chinese authorities quietly pared back imports of corn and wheat last year to insulate its farmers from worldwide downward pressure on farm prices. But the country's flood of imported Brazilian soybeans this year pressures prices of Chinese soybeans, with knock-on effects on prices of other crops. Several years ago Chinese authorities fretted about low profits undermining grain production incentives. Since then, farm prices have fallen further and the country's new cadre of scaled-up farms have a bloated cost structure. Now Chinese authorities have stopped publicly talking about the problem, likely an indicator that the problem has become even more acute.  As China's fall harvest gets underway crop prices are low and under a new round of downward pressure. The average price for corn--China's largest cro...

 China's November Consumer Price Index was up 0.2 percent. The food component was up 0.9 percent, but that number hides a lot of big price declines for agricultural goods further up the supply chain. The table below compares year-on-year changes in select food categories from the November CPI report with year-on-year price changes calculated from several other November price data reports from China.  For example, the CPI reported a 1.1 percent decline, but other data sources reported 18 and 19-percent declines for wheat, a 17 percent decline for flour, and price declines of as much as 4-to-6 percent for rice.  Beef prices are down 13.5 percent in the CPI and down 18.3 percent in the Ministry of Agriculture's wholesale price report. Milk prices are down 1.4 percent from last year in the CPI, but raw milk is down 15.2 percent according to the agriculture ministry's wholesale price data. Apples and potatoes are down about 10 percent from last year.  The main components ...

With Chinese farm prices down 10-to-18 percent from a year ago, the upcoming fall harvest looks set to deal a painful blow Chinese farmers' earnings.  Weekly prices from China's National Grain and Commodity Reserves Administration show the late-August 2024 procurement price for corn at RMB 2306 per metric ton, down 18 percent from a year ago. The collapse of Chinese corn prices occurred during last year's peak marketing season, from September 2023 to February 2024. Corn prices weakened again last month as the new corn procurement season approaches, suggesting that growers of China's largest crop may get hammered when they sell their grain this fall.  Compiled from China National Grain and Commodity Reserves Administration. Chinese soybean prices are down for the second year in a row. The average domestic soybean procurement price was RMB 4649 per metric ton at the end of August, down about 10 percent from a year ago. Chinese soybean prices fell during the last two marke...

There's much chatter about China falling into deflation after its July 2023 CPI report showed a -0.3 percent year-on-year decline. The food and beverage component of CPI showed a -0.5 percent year-on-year decrease that reflected mainly a crash in meat prices--especially a 26 percent decrease in pork prices from a year ago. Meanwhile, China's Q2 2023 index of farm prices (most recent available) showed a tiny -0.4 percent decrease from last year. Looking at prices of individual commodities from China's grain bureau, ag ministry, and rural market prices shows a falling trend or plateau for many commodities that began early in 2023 as the post-COVID-lockdown recovery narrative began to vaporize. Signs of deflation are surprisingly evident in Chinese ag prices, despite farmers abandoning land, floods, and downward pressure from surging imports.  Chinese soybeans are a clear example. Xi Jinping ordered an increase in soybean production last year to reduce reliance on imported b...

China's August 2022 CPI report  said pork prices were up 22 percent from a year earlier, the largest increase of any component of the price index. The Statistics Bureau reckoned that the 10-percent increase for the broader meat category contributed 0.32 percentage points to the 2.5 percent year-on-year rise in consumer prices. A year ago, the August 2021 CPI report said pork prices were down 44.9 percent from a year earlier, the largest decline of any component of consumer prices. In August last year, the meat component of the CPI pulled down the 0.9-percent CPI change by 1.2 percentage points.  According to agriculture ministry wholesale market price monitoring, August 2022 pork prices averaged 33.88 yuan per kg (about $2.23 per lb). That was higher than any historical pork price excluding the once-in-a-lifetime prices during Sept 2019 to January 2021 when African swine fever cratered pork supplies.  Data from China Ministry of Agriculture and Rural Affairs market mo...

A revival plan for China's soybean industry bears all the marks of Xi Jinping's broader "China Dream" of a glorious rejuvenation of Chinese culture and economic leadership. The doctrine asserts that it is now time to throw off foreign domination of an inherently Chinese commodity. China will create a market for soybeans with distinct Chinese features that will pull along suppliers in Eurasia and Africa, with processing led by Chinese companies and with prices determined in Chinese markets.  Economic Daily led off the month of August with a brief article, "Who has the power to set prices for domestic soybeans?" ( reposted on the Chinese commerce ministry's web site ) and followed up with a 12,000-word " Investigation of the Soybean Issue " feature article ( Harbin TV version with photos ). Many articles described the experimental corn-soybean strip-cropping technique rolled out this year. Several addressed non-GMO futures market topics, and the...

How is farm price inflation affecting China? Dimsums blog calculated price changes from major commodity prices collected over the past two years from the National Bureau of Statistics raw material price reports and Ministry of Agriculture and Rural Affairs to assess the overall picture--which is quite cloudy. A number of agricultural commodities in China posted double-digit price increases in 2021. However, the average 42-percent in hog prices swamped everything else. The figure below shows that cotton prices had the strongest increase, a 38-percent rise from 2020. Eggs, corn, soybean meal, domestic soybeans, and raw milk prices were up by 13 to 30 percent. Wheat, mutton, and beef prices posted single-digit increases. Rice prices have been falling due to weak downstream demand, with many provinces launching minimum price purchases to put a floor under prices following the 2021 harvest. Chicken and peanut prices were down 2% and 5%, respectively.  An overall price index (weighted by...