From the reality of our country, consumer price index (CPI) is an important indicator to judge inflation. According to the current statistical method, the weight of food price is 33.6%. Obviously, changes in food prices or their representative commodity prices have a direct impact on CPI. By evaluating the impact of agricultural product price changes on CPI, farmers' income increase and urban and rural residents' consumption expenditure through econometric model, we can draw the conclusion that:
Price increases are within a reasonable range and will not turn into obvious inflation.
In 2007, China's consumer prices continued to rise, and the annual increase may reach 4.5%-4.6%. Data show that in August 2007, consumer prices rose by 6.5% year-on-year. The direct reason is that food prices have risen sharply, reaching 18.2%. However, the increase of non-food prices and service prices remained at a low level, only 0.9% and 1.8% respectively, which obviously had little impact on CPI. From this, it can be judged that the CPI increase is a typical structural increase. Among the representative commodity grain, oil, meat and poultry selected to reflect the grain price, only pork price has obvious promotion effect on the previous CPI. Further analysis, assuming that the prices of other agricultural products except pork remain unchanged, if August 2007 is taken as the base period, every increase of pork price by 10% will push CPI up by 0.5%. Therefore, in August 2007, the CPI rose by 6.5%, of which the increase in pork price pulled by 3.6 percentage points, contributing 54.7% to the CPI increase.
However, the increase in agricultural product prices will not push CPI from structural increase to obvious inflation. If CPI is controlled within a certain range as an early warning indicator of inflation, the upper limit of pork price increase can be calculated according to the model. As shown in table 1, assuming that the CPI early warning index is controlled at 8% in 20071February, and taking August 2007 as the base period, the pork price increase in 10 1% in February must be controlled (equivalent to 2006/kloc before the pork price increase) On this basis, the adjustment level of pork price increase under other early warning schemes can be calculated respectively. In fact, in 2007 1 1 month, the price of pork increased by 60% compared with the same period of last year, far below the upper limit of regulation. It can be seen that the price increase of agricultural products such as pork is in a reasonable range at this stage, and the impact on CPI increase is only structural, not the fundamental factor to promote inflation. (Table 1)
Pork prices, which have a significant impact on CPI, are greatly affected by feed prices such as corn and soybean meal. The analysis shows that corn price has a lag effect on pork price. Every increase of 10% in the price of corn five months ago (taking into account that pigs have been slaughtered for about five months, which is also the result of many experiments of the model) will increase the current price of pork by 5.3%. However, the price of soybean has a direct impact on the price of pork. Every time the soybean price rises by 10%, the pork price will rise by 7.8%.
Soybean prices, which have a direct impact on pork prices, are highly marketized and internationalized. They are not only affected by the price changes of other domestic agricultural products, but also sensitive to the changes in the international market. For example, for every corn price increase of 10%, the soybean price will increase by 4.8%; For every pork price increase of 10%, the soybean price will increase by 0.7%; The soybean price in the international market rose by 10%, and the domestic soybean market price rose by 0.5% accordingly.
At the same time, the price fluctuation between different varieties of agricultural products is conductive and synchronous, with domino effect. When the price of one agricultural product fluctuates, it will affect the price expectation of other agricultural products, and all agricultural products will fluctuate. Therefore, pork price, as the forerunner of this round of agricultural product price increase, has driven the rise of grain and oil prices, further promoted the overall rise of the whole food price, and made CPI continue to rise.
Rising prices have increased the per capita monthly income of farmers and rural residents by 2 17 yuan.
How much impact does this round of agricultural product price increase have on farmers' income? The analysis results show that if the price of agricultural products does not rise, that is, it remains at the level before the price increase in 2006 1 1 month, the per capita cash income of rural residents in the first half of 2007 is 1894 yuan, while the actual per capita cash income of rural residents in the first half of 2007 announced by the National Bureau of Statistics is 211. This means that the rising prices of agricultural products have increased the per capita monthly income of rural residents by 2 17 yuan, with an increase of1.5% (Table 2 If the per capita income of farmers is increased by 2 17 yuan through direct subsidies and other measures, the central government needs to transfer payments160 billion yuan, which is equivalent to the whole country in 2006. (Table 2)
Comparatively speaking, the per capita cash income of rural residents in the first half of 2006 was 1800 yuan, an increase of 12% over the same period in 2005. If the price of agricultural products does not rise, the per capita cash income of rural residents in the first half of 2007 is only 1894 yuan, an increase of only 5.6% over the same period in 2006. Obviously, this round of rising prices of agricultural products increased farmers' income by 17% in the first half of 2007 compared with the same period of last year.
Increase the consumption expenditure of urban residents in 58 yuan.
Similarly, we can estimate the impact of rising agricultural product prices on the consumption expenditure of urban and rural residents. As shown in Table 3, in the first half of 2007, the per capita actual consumption expenditure of rural residents was 1286 yuan, but if the prices of agricultural products did not rise, the consumption expenditure would be 1 166 yuan. It can be seen that the rising prices of agricultural products have increased the per capita consumption expenditure of rural residents by 120 yuan, with an average monthly increase of 10.3%. In the first half of 2007, the per capita actual consumption expenditure of urban residents was 4,830 yuan, more than that of 350 yuan when the prices of agricultural products did not rise, and the average monthly expenditure increased by 7.8%.
The New Trend of Agricultural Product Price Fluctuation
This round of agricultural product prices is a recovery. Although it has promoted the structural increase of CPI in the previous period, it is still in a reasonable range. Generally speaking, the reasonable increase of agricultural product prices is of great significance to solve the problems of agriculture, countryside and farmers, especially to increase farmers' income. At the same time, the sustained high prices of agricultural products will become an inevitable basic trend in the process of economic development. Therefore, we must further understand and grasp the new characteristics and trends of agricultural product price fluctuations:
The new round of agricultural product price fluctuation is first caused by the rise of pork price, which drives the overall price increase of eggs, aquatic products and grain, and has obvious recovery characteristics. This not only has the transmission effect of international price increase, but also has the promotion effect of increasing the production cost of agricultural products; It is not only the inevitable trend of upgrading the demand structure of agricultural products, but also the result of unexpected factors such as animal diseases.
In 2007, the consumer price in China continued to rise, with an annual increase of 4.8%. The direct reason for the increase of CPI in the early stage is the sharp increase of food prices, but the increase of non-food prices remains at a low level, so it has typical structural characteristics. Among them, the rise in pork prices has a significant role in promoting CPI. Every pork price increase of 10% will push CPI up by 0.5%. For example, in August 2007, the CPI rose by 6.5%, of which the rise in pork prices led by 3.6 percentage points and contributed 54.7% to the CPI increase. In order to control CPI below 8%, the price increase of pork should not exceed 3.5 times of the price in 2006 1 1 month before the price increase, and the average monthly increase should not exceed 19%. In fact, in 2007 1 1 month, the price of pork increased by 60% compared with the same period of last year, far below the upper limit of regulation. Therefore, at this stage, the price increase of agricultural products such as pork is in a reasonable range.
The price fluctuation between different varieties of agricultural products has typical conductivity and synchronization, and has domino effect. For example, the price of pork, which has a significant impact on CPI, is greatly affected by feed prices such as corn and soybean meal. Among them, corn price has a lag effect on pork price. Every 10% increase in corn price five months ago will increase the current pork price by 5.3%. However, the price of soybean has a direct impact on the price of pork. Every time the soybean price rises by 10%, the pork price will rise by 7.8%. On the other hand, for every corn price increase of 10%, the soybean price will also increase by 4.8%; For every pork price increase of 10%, the soybean price will increase by 0.7%.
The price increase of agricultural products is of great significance to farmers' income, and farmers must really share the benefits of price increase. In the first half of 2007, the rising prices of agricultural products increased the per capita income of rural residents by 2 17 yuan, an increase of 1 1.5% compared with that without price increase, which was equivalent to the central government subsidizing farmers160 billion yuan. This means that in the new stage of China's economic development, while increasing support for agriculture and rural areas, we should also give full play to the basic role of market mechanism in allocating resources, promote farmers' income through price leverage, and mobilize farmers' enthusiasm for production.
Six major regulatory recommendations
At present, there is increasing pressure to prevent structural price increases from turning into obvious inflation. Realizing the basic balance between supply and demand of important agricultural products such as grain and keeping prices basically stable at a reasonable level is the basis for ensuring the overall sustained, healthy and stable development of the economy and society, which is of particular significance under the current new situation.
First, efforts should be made to improve the comprehensive agricultural production capacity and effectively ensure the effective supply of major agricultural products such as grain. It is necessary to effectively improve agricultural production conditions focusing on water conservancy, accelerate agricultural scientific and technological innovation, and improve the ability of agriculture to resist natural risks. We will continue to implement the minimum purchase price policy for important grain products in key areas, improve farmers' enthusiasm for growing grain, and promote the stable development of major agricultural products such as grain.
Second, strengthen the material basis of agricultural product market regulation and improve the regulation ability to cope with market fluctuations. Take the reserve system of important agricultural products such as grain and pork as the key means of macro-control, increase support, optimize the reserve structure and regional layout, improve the adjustment mechanism of reserve throughput, and guide and encourage the establishment of a commercial reserve system of important agricultural products with enterprises as the carrier by means of investment and subsidy support. At the same time, it is necessary to strengthen the government's responsibility to ensure food supply and strengthen the capacity building of food emergency support.
Third, establish and improve the market monitoring and early warning system for important agricultural products, closely follow the domestic and international market situation and changing trends, improve the information release system for supply and demand of agricultural products and price, and enhance the scientific and predictable regulation. It is the most important and urgent task for the whole society to correctly guide and stabilize the price expectation of agricultural products.
Fourth, establish an import and export strategic mechanism that makes full use of the international market and resources, flexibly use import and export means, improve the import and export adjustment mechanism, and promote the basic balance between supply and demand of important agricultural products such as grain in China.
Fifth, strengthen the construction of rural market circulation system, improve the circulation efficiency of agricultural products, and let farmers really share the benefits of rising agricultural product prices. It is necessary to speed up the upgrading and transformation of agricultural products wholesale markets in large and medium-sized cities and concentrated producing areas, strengthen the construction of cold chain logistics system for fresh agricultural products, actively promote the construction of modern grain logistics system, and fully implement the national green channel policy for fresh agricultural products. Actively develop new varieties of agricultural futures and strengthen market risk management of agricultural products.
Sixth, we should solve the practical difficulties of urban subsistence allowances and other difficult groups that are greatly affected by rising prices through financial subsidies and raising the standard of subsistence allowances.