China aims to ease inflation by ensuring food supply

China's efforts to deflate consumer price increases this year will focus on farm produce. This could be more costly due to a global trend in increasing prices and rising domestic production costs, a senior agricultural official noted here on Tuesday. "The Chinese government will strive to bring the price hikes under control ... by expanding (farm) production for steady supply," said Gao Hongbin, vice minister of agriculture, at a press conference. The prices of the country's major foodstuffs, including grain, pork and cooking oil, surged in late 2007, lifting the nation's consumer price index (CPI) to an 11-year high of 6.9 percent in November, well above the government-set three percent target. The price rise related to the global market, said Gao. He pointed out wheat, maize and soy beans in the global market were climbing and that crude oil had broken the 100 U.S. dollars a barrel mark. He also cited increased labor costs and fewer farmers to grow crops due to the fast urbanization. "Rural residents who may raise pigs have been swarming into cities and have become pork-consumers." China produced more than 500 million tons of grain in 2007, the fourth consecutive year of yield growth. Production, however, was short of demand. "We aim for another grain production of more than 500 million tons in 2008," Gao told reporters. He added the government had introduced a series of policy incentives for farm production and higher allowances for poor city dwellers so that their lives would not be too affected in face of rising prices.