According to Ministry of Commerce, a series of timely and resolute macro-control measures taken by central government has produced active effects. Last year, China witnessed a favorable trend of growth in national economy with the commodity sales realizing a marked breakthrough, the accelerated rural consumption, stable and falling tendency of grain and non-staple food price as well as the relatively rapid development of commodity market. However, currently there are still six major problems demanding prompt solution in commodity market.

I. Although agricultural production has registered a record harvest, the agricultural basis is still weak. The price fluctuation of cotton, bean and other farm produces was rather frequent. The increase of farm produce but cheap price often harmed the initiative of peasants in some regions.

II. Under the influence of market demand and other factors, the pressure of price hike still exists. The price increase for means of production reached 13.6 percent in 2004, and the price for some basic raw materials experienced rebound after a slight drop. The shortage of coal, power and oil and transportation has not been thoroughly solved.

The sale of steel and cement will maintain rapid growth with an increase of more than ten percent. And the prospect of some chemical products such as chemical fertilizer, agricultural chemical and chemical fiber are good. Along with the cancellation of import quota and the lower of tariffs, the price of auto will continue to drop, and therefore the sales of auto are expected to achieve a more rapid growth. The housing consumption will upgrade the structure of consumption. The energy-saving commodity will find favor in the eyes of consumers.

III. The over-heated increase of output in some industries has led to the overstock of products and much occupancy of funds.

IV. There are still many problems existing in the market order. The counterfeit and shoddy goods flooded the market and the market business order requires to be further regulated.

V. There are too many factors that hinder the development of rural commodity market. The price increase of means of production for agricultural purposes and the consumption for rural inhabitants is too fast.

VI. Consumption is still not in tune with investment. The gap between the total retail volume of national social consumption and the increase of fixed asset investment in 2004 stood at as high as 12.5 percent. Regardless of the factors of price variation, the total retail volume of national social consumption is forecasted to register an increase of 10 percent this year.

By People's Daily Online