Chinese City Goes Back to Rationing to Curb Rampant Pork Prices

(Bloomberg) --

One Chinese city has gone back to rationing and price controls to calm its pork market, as the nation’s hog herd is ravaged by a killer disease and wholesale prices spike to record levels.

Vendors in 10 selected wet markets in Nanning, capital of the southern region of Guangxi, are selling pork cuts capped at a maximum price over the first 10 days of September, according to a statement posted on the website of the local government’s planning body. The most expensive, ribs, won’t retail for more than 32.2 yuan ($4.50) per half a kilo.

For many, rationing evokes the hardships of wartime, but China’s so-called planned supply method of distributing groceries harks back to its communist heyday of the 1950s. It was gradually abolished in the 1980s as supplies became more ample following economic reforms.

Each customer is allowed only 1 kilo of pork, the Nanning Evening News, a local government newspaper, reported on Sunday. The steps are necessary to control surging prices given the time it’ll take for pork production to recover, the newspaper said.

The move shows the ill-effects of African swine fever, first reported about a year ago, now taking a firm hold in retail markets, and the government is expected to offer more incentives for farmers to restock even as imports surge. Given the Chinese love of pork, it’s also a potential challenge to maintaining a happy citizenry in the run-up to the 70th anniversary of the People’s Republic in October.

“Pork is an indispensable food on the table, and the high price of pork has seriously affected daily life,” according to the Nanning newspaper.

To contact the reporter on this story: Alfred Cang in Singapore at acang@bloomberg.net

To contact the editors responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net, Jason Rogers, Anna Kitanaka

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