China says pork prices surged 110% in November

Pork prices in China surged in November, pushing the country’s consumer price inflation to its highest level in eight years, official government data showed on Tuesday.

According to the National Bureau of Statistics, pork prices rose 110% in November compared to a year ago. In October, pork prices rose 101% from a year ago.

Overall, consumer prices in China rose 4.5% in November from a year earlier, while producer prices in the same month fell 1.4% from a year ago.

Hog herds in China have been severely hit by African Swine Fever since last year, which have disrupted supplies of the staple meat in the world’s largest pork consumer.

However, Julian Evans-Pritchard and Martin Rasmussen, China economists at research consultancy Capital Economics, don’t expect the trend of rising food prices to continue.

“The pick-up in food inflation will reverse soon and broader demand-side price pressures remain weak, with producer prices falling and core consumer price inflation at a three-year low,” they said in a note on Tuesday.

There are also signs that African Swine Fever is now being brought under control, they added.

“After dropping by over a half in the space of a year, China’s pig stock started to recover in November. And while pork inflation remains high in y/y terms, it moderated significantly in m/m terms last month,” the economists wrote.

“It may take a little longer before pork prices start to drop back, but consumer price inflation should peak before long as a result,” they added.

Overall, demand-side pressures remain lackluster, as non-food inflation was close to a three-year low, said the economists.