As the price of major grain products, including rice, flour and cooking oil, surged 4.7 percent across China during the month of November alone, the government continued its balancing act on a double edged sword.

Ensuring farmers receive adequate compensation and consumers retain their confidence are essentials of government policies that must also absorb major price hikes on international markets.

Using its full arsenal of control measures, China's central government is requiring citizen to have patience, understanding and confidence that there will be a stabile supply and price fluctuations will be gentle.

The government is also rightly insisting that citizens avoid hording supplies and grain wholesalers and retailers refrain from any form of price gouging.

China's grain prices have been generously low for years, curbing the enthusiasm of farmers to grow grain, which in the long run could affect the country's grain security.

To protect Chinese farmers from artificially low grain prices the government set a minimum selling price for farmers' grain last year.

The state's minimum purchase price has helped maintain a fair price for farmers even during times of ample supply, a result of recent consecutive bumper harvests.

The opposite result in farm harvests in other parts of the world, caused by droughts in the United States and Australia, have caused sharp spikes in global grain prices.

Spot market prices on Nov. 22, show price jumps from the previous month of 6.2 percent for wheat, 36.7 percent for corn and and 25.4 percent for soybean.

As China continues to be a net importer of grains its domestic price will inevitably be affected by fluctuations in the international market.

With the help of three consecutive years of bumper crops - this year's grain output is expected to exceed 490 billion kilograms -- the government has been able to increase the country's stockpile and provide a stable supply of grains to the market.

Although gradual grain price hikes may cause some difficulties to low income urban residents, the increases will benefit Chinese farmers and encourage them to grow more grain next year.

Figures show the price of wheat offered to farmers in eastern Shandong Province rose from 1.4 yuan per kilogram in September to 1.6 yuan in early December.

When farmers benefit from grain price increases it allows them to catch up to the rising incomes that urban residents have recently enjoyed and alleviates the imbalance in China's distribution of wealth.

To protect low-income consumers the government has plans to raise subsistence allowances.

Since Nov. 25, the Chinese government has allowed incremental increases in the supply of grain by releasing some of its national stockpile. It's using its bountiful reserves as a tightrope walker's balancing rod to offset international price jumps, provide farmers with the income increases they deserve, while keeping consumers from choking on price increases that might cause some people real hardship.

It's all a difficult balancing act that deserves our respect and cooperation.

Source: Xinhua