BEIJING, Feb 10, 2020, CNBC. Pork prices in China surged 116% in January from a year ago, accelerating from December’s 97% increase, official government data showed on Monday. That drove the country’s food prices up by 20.6% in January compared to a year ago, and helped push overall consumer inflation to 5.4% over the same period, according to data from the National Bureau of Statistics of China, CNBC reported.
Analysts polled by Reuters had forecast a 4.9% year-on-year rise in consumer prices.
The bureau said in a statement that last month’s year-on-year jump in consumer prices was due to the Lunar New Year festivities, an outbreak of a new coronavirus and lower base of comparison with last year’s prices.
China’s pork prices have been climbing on the back of an outbreak of African swine fever, which killed a large number of the country’s hog population. Demand for pork — a staple in the Chinese diet — typically increase ahead of the Lunar New Year.
At the same time, the ongoing coronavirus outbreak — believed to have started in Wuhan city in China — may have caused some disruptions in food supply, said Julian Evans-Pritchard, senior China economist, at consultancy Capital Economics.
“It appears that supply disruptions and hoarding due to the coronavirus outbreak helped to keep food prices elevated during the week after Chinese New Year, when they would normally drop back,” he wrote in a Monday note after the release of China’s January inflation data.
Hannah Anderson, global market strategist at J.P. Morgan Asset Management, told CNBC’s “Street Signs Asia” on Monday that there will likely be “quite a bumpy ride” in consumer prices in the coming months.
She explained that the trajectory for inflation in China this year will depend on how quickly economic activities resume following the virus outbreak.