Ag Prices in China Declined During Fall Months

Falling agricultural prices suggest something happened to let the air out of China's economy in October. 

Weekly farm commodity procurement prices reported by the State Commodity Reserves Administration showed steep declines in corn and soybean prices during October; they seemed to stabilize in November. Rice prices increased and wheat prices were relatively steady.

Calculated from weekly procurement prices reported by
State Administration of Grain and Commodity Reserves 

Most agricultural raw material prices paid by enterprises peaked in September and fell at varying paces during October and November. 

Calculated from prices reported three times per month by China National Bureau of Statistics.

The two data sources agree that corn and soybean prices went down over the last three months and rice prices went up. Soybean meal had the steepest decline (-17.5%), followed by peanuts (-15.7%) and hogs (-13.2%).

Calculated from price indices shown above.

Monthly CPI reports indicate a downshift in prices in October-November. The food component of the CPI went up 0.2% in September, dropped 0.4% in October and dropped 0.6% in November. These indexes imply a 1% cumulative drop in food prices during October-November. Grain and fruit were the only food components of the CPI that went up over the last two months. The steepest declines over the last two months were for eggs (-6.2%), vegetables (-5.9%), pork (-4.9%), and aqua products (-3%).

Hog prices peaked first--in August--at 17.3 yuan per kg according to the NBS raw material price survey. During the 4 months that followed hog prices dropped 16% to 14.5 yuan per kg in late November despite October holidays and the approaching Lunar new year holiday, usually the peak consumption period. 

Average raw material prices paid by enterprises 3 times per month,
reported by China National Bureau of Statistics.