An economy where food and pigs count

Thursday, October 1, 2009

In China, food makes up one third of the consumer price index and pork is a big chunk of that. On average, the Chinese consume 110 pounds of meat per person per year and 65 per cent of that is pork. There are too many pigs in China, so inflation is likely to be kept in check. China needs 410 million pigs, including 41 million sows, to keep production in equilibrium, according to its central planning agency. There were 44.7 million live hogs and 48.3 million sows at the end of June, a huge increase from the year before, when there was a pork shortage and high prices.

In February, 2008, NBC News reported that pork prices had risen 50 per cent compared to the previous year. The rise was blamed on the growing economy, blue ear disease, high grain prices and bad winter weather. Chinese markets are generally independent of world markets, although China does import pork from Smithfield Foods in the United States.

There were concerns that raging inflation might cause poor economic times and upheaval in China. Economic and social upheavals in China go hand-in-hand. The last round was in 1989. Does anyone remember Tiananmen Square? BP