Agricultural product prices continue to rise pushing up CPI in May

According to statistics from the Statistics Bureau and the monitoring price of agricultural products, the Economic Observer Online reporter Yu Yunzhang showed that the prices of agricultural products, vegetables, and food continued to surge in late May, and the prices of industrial products continued to maintain rapid growth. Oriental Wenger’s analyst Ma Wenfeng stated that it is expected that the CPI will reach a new high in May and the PPI will remain high. It is worth noting that the producer prices of agricultural products have fallen, and the macro-control must be further strengthened and the difficulty further increased.

From the perspective of the food prices of the 50 cities announced by the National Bureau of Statistics, the average price of all food prices in late May increased by 1.52% compared with the mid-term. The average price of food prices in the two consecutive ten days increased. Among them, grain and oil rose 0.06%, and meat and poultry eggs rose 1.68. %, Aquatic prices rose an average of 1.90%, seasonal vegetables rose an average of 5.26%, seasonal vegetables kept a rapid increase in two tense; in late May the price increase of all kinds of products equivalent to annual changes were 72.17%, 2.08% and 81.85%, 532.49%. Compared with the same period of last year, the price of all foods rose by 16.40%; grain and oil prices rose by 15.96%; poultry eggs rose by 26.46%; aquatic products prices rose by 17.00%; vegetables rose by 6.91%; of which pork prices continued to increase, with an increase of 54.14%. The pull-down effect of seasonal vegetables on prices disappeared, which exacerbated the increase in food prices and thus promoted the overall increase in CPI.

Ma Wenfeng said that from the monthly price point of view, urban food prices rose by 13.37%. Excluding a 4.69% month-on-month decrease in fresh vegetable prices, the prices of other categories of products rose by more than 14.5%, with the smallest increase being milk and fishery prices. The rate of increase was below 15%, meat rose by 31.12%, and the monthly average price of pork rose by 48.32%. It continued to lead various types of food, which was the highest among gainers.

From the price index of agricultural products in the wholesale market of the Ministry of Agriculture, in late May, the comprehensive price index for agricultural products rose by 2.36% from 184.64. The comprehensive index of basket prices was 183.59, up by 2.84% from the previous ten-day period. The annual decline is equivalent to 131.82% and 173.61% respectively. The monthly average price index was 181.4 and 179.8, respectively, an increase of 12.00% and 11.90% respectively. In June, prices continued to rise sharply on the comprehensive index of agricultural product prices and basket prices, which was close to the highest level in February. It is expected that the recent price hike will continue to be driven by higher prices.

In terms of industrial products, the ex-factory prices of major industries rose by 0.26% in the second half of the previous month from the previous half in May, of which fuel energy rose by 0.31%, equivalent to an annual increase of 6.50% and 7.76%, respectively. Compared with the same period last year, it increased by 14.57%; of which fuel energy increased by 16.94%. The monthly price of 13.98% is down by 0.07 percentage points and 0.82 percentage points from the previous month.

Judging from the recent macroeconomic factors and other factors affecting commodity prices, the drought in the Yangtze River Basin is expected to have some impact on the production and output of agricultural products. Although it will not have the fundamental impact of food production, it will affect food production. The cost has a corresponding impact, resulting in an increase in the cost of food production, thus propelling expectations of rising food prices; aquaculture and the Yangtze River shipping being severely impacted, pushing forward the current prospects for rising prices of aquatic products; and the decline in the flow of dry bulk tributaries of the Yangtze River for logistics transportation. The impact on transportation costs in the Yangtze River Basin has also pushed up consumer prices for end-uses; the increase in pork prices reflects a large decline in the current inventory of live pigs, leading to a sharp rise in the price of pork during off-season consumption. Due to the cyclic nature of live pig production, the supply of pork Recovery will take a long time, and at the same time, the rise in food feed prices will also boost the production costs of live pigs, leading to the continued high pork prices in the future. In addition, the increase in rents in urban areas will also push up the important factors of residents' consumer prices.

From the macroeconomic point of view, domestically, domestic investment rose in April on the premise of a significant increase in money supply in March. Domestic investment increased significantly in April. At the end of April, domestic investment reached 6.27 trillion, of which the investment in April reached 2.33 trillion yuan. Monthly increase of 37.18%.

In terms of domestic consumption, domestic consumption in April was 1.36 trillion yuan, an increase of 17.1% year-on-year; cumulative total consumption reached 5.66 trillion yuan, a year-on-year increase of 16.5%. The total investment in January-April reached 11.9 trillion yuan, an increase of 26.06% over the previous year. The rapid growth of consumption and investment pushed up prices.

In terms of industrial production, the main business of large-scale enterprises was 24.1 trillion yuan, an increase of 47.4% year-on-year; the cumulative profit reached 1.49 trillion yuan, an increase of 29.7% year-on-year; the main business profit rate reached 6.17%, and the increase in corporate profitability boosted corporate investment and production. Expansion also promotes the expansion of domestic demand.

In terms of imports and exports, despite the accumulated trade deficit of US$25.28 billion in the first four months, the trade surplus increased significantly in April, reaching US$11.42 billion, and the trade surplus contributed to the growth of domestic demand.

In terms of total macroeconomic demand, the total supply of M2 from January to April was 3.15 trillion, and the growth rate of new macro total demand decreased by 31.95% from the same period of last year. However, the total aggregate demand of society in the society totaled M2 total supply of 75.78 trillion yuan. The growth rate was 15.4% in the same period of last year; investment growth was the main driving force behind the rise in domestic prices. Judging from the value of currency, the US dollar monthly comprehensive index for May was 74.94, which was a 0.28% increase from the previous month and a depreciation of 12.29% from the same month of last year. The passive change of the RMB following the US dollar rose by 0.72 percentage points month-on-month and depreciated by 7.5 percentage points year-on-year. The sharp depreciation of the yuan year-on-year was an important factor in the recent rise in domestic prices, but the ring's rise from the actual price also limited the price chain's rise.

Concerning the changes in prices in late May and May and the impact of the latest price increase events, Ma Wenfeng expects that the overall price level in China will continue to remain high in May. The CPI will remain at 5.4-5.8%, up 0.1% from the previous month. -0.3%; PPI will remain at the level of 6.7-6.9%, showing a slight decline from the previous month.

Judging from the trend of development of various commodity prices, especially the trend of changes in the prices of various commodities since June and the evolution of the macro economy, the price situation in June is still not optimistic and will continue to show a decline in producer prices. Consumer prices continue to rise. In particular, the producer prices of various types of agricultural products will show a declining trend, production will be seriously curbed, and the healthy development of China's economy will be hindered. The difficulty of macroeconomic regulation will be further increased.