China’s inflation boosted by lack of pigs

A relative lack of pigs has been beneficial to China’s economy in the last few weeks. This could prove to have been be helpful for China’s economy.

The British newspaper Daily Telegraph reports that the price of pork rose steeply last month, rising by 19.6% year-on-year. The meat’s rising cost, partly due to a sharp fall in pig numbers, made overall inflation jump, for a third month in a row.

Seeing that pork is a heavy factor in the country’s consumer price index (CPI), inflation hit a one-year high of 2% in August, up 0.4 percentage points on July. This helped to alleviate deflation stress over in the world’s second largest economy.

Pork prices have been pushed up by growing demand, which is simply higher than demand to pork. In addition, Ministry of Agriculture data indicate that the number of sows recently fell to a record low.

It is expected that pork price inflation stays high well into 2016.

Also read: Rabobank: China’s hog herd shrinking ‘incredibly’