Growth of China's gross price levels to subside

The circulation prices for production goods reversed a 17-month-long consecutive growth in the second quarter of this year if compared that with the same period of last year. The growth indices declined 1.4 and 0.3 per cent respectively if compared with the same period of last year. The average price levels of steel building materials in June were down 22 per cent if compared with that of March. These changes mean that the macro-control policies to stabilize market prices put into practice by the State have yielded active results.

Since the beginning of this year, the average market price levels were continuing to rise. In the first seven months of this year, the consumption prices were up 3.8 per cent and retail sales prices were up 2.6 per cent; the gross price levels for industrial production goods in circulation area was up 14 per cent. They were the highest price hike margins since 1997, causing widespread concerns from governments at all levels.

To prevent the gross price levels from over-fast growth, all areas and departments have implemented and put into practice a series of macro-control policies adopted by the Central committee of the Communist Party of China and the State Council, especially the strict control of credit volume and enhancing land management. This has laid a foundation to prevent prices from over-fast rise. In the fields of price supervision and controls, the governments at all levels had worked out a series of measures.

Judging from the present situation, the various measures adopted by the Central Committee of the Communist Party of China and the State Council had achieved obvious effectiveness. The growth trend of gross price levels has been brought under control. The gross price levels, namely the monthly consumption price indices for inhabitants, were declined for three consecutive months from May to July.

The grain prices were kept stable basically. On the basis of the price fluctuation appeared last October, the grain prices were fluctuated in February due to the influence by the concentrated purchase of grain in some areas from the East China to the Northeast China. The related areas and departments had timely adopted a series of control-measures to enhance the grain market management so that the price hikes for grain were slowed down in the March and the prices were kept stable after April. In June, the purchasing prices for wheat, corn and rice given by the State-run grain-purchasing enterprises were 68.4 yuan for per 50 kilograms on average, equaling to the same price levels in May.

The prices for steel materials were stable. According to the survey on 22 major steel trading markets, the price-rising margins for four steel materials in China domestic market were the highest in history. From the latter half of March, the steel materials prices for building industry started to decline. From April to May the decline was quickened. Within two and a half months, the steel prices were down more than 1,000 yuan. In the latter of May, the steel prices started to reverse the rise trend. In July steel prices started to pick up. However, the prices were lower than in March.

The price hike trend for chemical fertilizer has been controlled. Started from the fourth quarter of last year, the prices for agricultural production goods including chemical fertilizer have been on rise. According to statistics by 18 grain and cotton producing provinces, the average price for urea at the beginning of March was 1,451 per ton with retail price of 1,602 yuan per ton, up 11.3 and 14.8 per cent respectively over the same period last year. The prices for imported ammonium dibasic phosphate and potassium chloride were up 21.6 and 19.8 per cent respectively. After the temporary tampering measures by various areas, the prices for fertilizer started to drop in the later of April. In the end of June and at the beginning of July, the prices went up in some areas due to the short supple of fertilizer as the second round of fertilizer-using peak set in. With the pass of the peak time for fertilizer, the prices will be kept stable basically.

The prices for industrial consumption goods went downward. The prices for popular industrial commodities including autos, electric household appliances, telecommunication goods were kept downward. In the first seven months of this year, the prices for clothing and household commodities as well as for services and telecommunications were down 1.4 per cent, 1.6 per cent and 1.6 per cent if compared that with the same period of last year, an important strength to prevent the total price levels from rising.

By People's Daily Online