Ministries tackle sagging vegetable prices

PUBLISHED : Sunday, 24 April, 2011, 12:00am
UPDATED : Sunday, 24 April, 2011, 12:00am


The agriculture and commerce ministries yesterday issued emergency measures to help stabilise vegetable prices because farmers have started to dump low-value produce.

The Commerce Ministry said average prices of 18 vegetables had dropped by 16.2 per cent over the past three weeks.

Compared with last year, the price of cabbage had dropped by as much as 50 per cent, and celery was now 77 per cent cheaper.

The low prices have prompted vegetable farmers in Beijing, Shanghai, Shandong, Zhejiang and Henan to destroy hundreds of thousands of kilograms of cabbages, celery and other produce.

The Beijing News reported that the market price of cabbages was 3 yuan (HK$3.60) per kilogram at the capital's food markets and supermarkets, but the bid price for farmers was just 0.2 yuan a kilo. That contrast illustrated the government's dilemma in taming inflation, as many charges at different levels push up food prices.

According to the National Bureau of Statistics, consumer inflation on the mainland reached 5.4 per cent year on year in March, a 32-month high and up from 4.9 per cent for the first two months of the year. Food items topped the list with a rise of 11.7 per cent year on year.

The Ministry of Agriculture said it would help farmers expand direct selling networks covering supermarkets, schools and even packing houses. It would also encourage food markets and supermarkets to cut entrance fees when promoting farmers' vegetable produce.

With farmers complaining that the present overproduction and unmarketable produce had resulted from their being misled by last year's good vegetable prices, the ministry promised that a clear and forward-looking information system would be set up as a reference for farmers' planting plans.

The Ministry of Commerce said yesterday it would help farmers set up a relief management or insurance system in case of crises.

'I don't need to pay any costs, including chemicals and workers' wages, after giving up all the plants,' The Beijing News quoted Liang Ping, a Sichuan native who was digging up all his rapeseed plants in a greenhouse in the capital's Daxing district, as saying. Liang said the cost of cultivating his plants was 1.2 yuan per kilogram, but the bid price offered by wholesalers was just 0.1 yuan. 'But if I insist on harvesting all those valueless vegetables, I still have to spend money hiring part-time workers.'

A frustrated Jinan farmer in Shandong province took his life this month after realising his cabbages could only be sold for 0.16 yuan per kilogram, resulting in a loss of more than 10,000 yuan.

The suicide shocked the public, but neither farmers nor urban residents understand why vegetable farmers cannot benefit from the current high inflation.

Economists have warned that disappointed farmers may plant fewer vegetables or even give up planting in the next year, which could provoke a new crisis.