PORK CRISIS IN CHINA PROMPTS CONCERNS

A disease killing millions of pigs in China has sharply lifted the price of pork, the country's staple meat, fuelling fears about inflation and prompting calls from Beijing's top leadership for increased production of the meat.

Wen Jiabao, the premier, provided confirmation of the seriousness of the crisis with a weekend visit to a market in Shaanxi, where he said farmers should help "resolve the problem" of providing meat for China's 1.3bn people.

Pork prices have risen by as much as 30 per cent in Chinese cities over the last week. According to the agriculture ministry, wholesale prices for pigs have gone up even more, rising 71.3 per cent since April.

China's 500m-odd pigs are the country's most important source of affordable meat, and any sustained interruption in supply would be a major political problem for the government.

While the price of feed, such as corn, has risen, the main culprit is an epidemic of a mysterious illness known as 'blue ear' disease, as well as the more common foot-and-mouth affliction.

"I have heard it has killed as many as 20m hogs," an industry executive said yesterday.

The government has not issued any estimate of how many pigs have been struck by disease and China's size and the number of small producers make it difficult quickly to obtain reliable figures.

But the impact of the shortage of pork is apparent in many areas, from sausage makers switching meats, to rising offal prices, and attempts by Hong Kong to import meat from South America.

China cannot easily find competitively priced pork to replace the shortfall at home, because of its own health-related restrictions on imports from South America, where prices are relatively low. US and European pork is relatively expensive.

China Concerned Over Pork Price Increase

China's leaders are trying to calm public concern over sharp price rises for pork, the country's staple meat, ordering local governments to ensure adequate supplies and help low-income families.

''Production and distribution of pork and its products relates to the lives of the masses and influences the overall situation,'' China's Cabinet, the General Office of the State Council, said in a statement carried on the front pages of official newspapers Wednesday.

High-level concern over the price rises was signaled by Premier Wen Jiabao's visits last weekend to pork producers and markets, when he pledged an official response would be forthcoming.

State media mentioned the possibility of using a strategic reserve of frozen pork and live pigs that the government maintains to guard against severe shortages, although the Cabinet's circular, issued after a meeting Tuesday, did not directly address such a move.

Urban Chinese eat more pork than any other meat, an average of 42 pounds per person in 2006, according to official statistics.

Prices of the meat rose by an average of 8.6 percent in April over the previous month, and were up 43.1 percent over April 2006, according to the Commerce Ministry.

Among measures ordered were subsidies for producers to encourage hog rearing and increase supply. Railways and other transport networks also are to give priority to deliveries of pork and live hogs, while governments are to increase food assistance to low-income families in line with the rise in pork prices, the circular said.

The document blamed the price increases on rising grain and feed costs, and an outbreak of blue ear disease, also called porcine reproductive and respiratory syndrome, which led to the slaughtering of herds and a sharp reduction in the numbers of piglets born.

''Appropriate increases in the price of live pigs and pork can be of benefit by boosting farming incomes,'' the circular said.

''However, if they rise too fast, that will cause increases in the price of other meat, poultry, eggs, and other foods and prices in the food and beverage industry, and affect the lives of low-income residents,'' it said.