Farm Produce Prices Continue to Decline

BEIJING, Oct. 26 (China Dailly) -- Farm produce prices in China continued to fall in the week ending Oct 23 compared to the previous week, the Ministry of Commerce said in a report released on Tuesday.

Vegetable prices posted the sharpest declines, with the wholesale prices of 18 staple vegetables down 2.5 percent on average during the week, the report said.

Meanwhile, the price of pork fell 1.8 percent, 0.6 percentage points more than the fall of the previous week. Pork prices have dropped 3.7 percent since mid-September as supplies increased, the report said, expecting the downward trend to continue in the short term.

Egg prices shed 0.8 percent from the previous week, extending losses from a 0.4 percent decline during the week ending Oct 16.

The price of chicken, beef and mutton posted slight increases during the week, according to the report. Eight kinds of seafood products also saw an average price rise of 0.3 percent.

Food prices, which account for nearly one-third of the basket of goods in calculation of China's consumer price index (CPI), have been the main driver of inflation.

The index eased to 6.1 percent in September from 6.2 percent in August and a 37-month high of 6.5 percent in July. The government's full-year target is around 4 percent for this year.

To keep inflation in check, the People's Bank of China has raised interest rates three times so far this year and hiked reserve requirement ratio six times to drain excessive money out of market.

China's stubbornly high consumer prices are set to decline this year, as the government's cooling measures take effect, said Peng Sen, vice director of the National Development and Reform Commission, the country's top economic planning agency.

The CPI index is expected to decline to less than 5 percent in the next two months, he said on Monday.