Chinese Measures for Commodity Supply & Stable Prices
China’s State Council's Executive Meeting chaired by Premier Mr Li Keqiang has decided that China will work to ensure the supply of commodities and keep
China’s State Council's Executive Meeting chaired by Premier Mr Li Keqiang has decided that China will work to ensure the supply of commodities and keep their prices stable, to maintain steady economic performance. Mr Li said "We must carefully analyse the reasons behind this round of rapid increase in commodity prices and focus on the crux of the issue, to adopt measures in a targeted and holistic approach. While the market continues to play a decisive role in resources allocation to ensure the supply of commodities and keep their prices stable, the government must better fulfil its responsibility. Any monopoly and hoarding will be cracked down upon under the law to step up market regulation.”
A host of steps were decided to strengthen two-way adjustment of supply and demand, including raising export tariffs on certain iron and steel products, temporarily exempting tariffs on pig iron and scrap steel, and cancelling export tax rebates for some steel products, to increase supply in the domestic market. Dedicated efforts will be made to advance structural adjustments and discourage projects with high energy consumption. The country's rich coal resources will be further tapped. Key coal companies will be encouraged to raise production and supply while ensuring safety and the capacity of wind, solar, hydro and nuclear power will be increased to ensure energy supply during summer peak time.
Opening-up will be pushed forward, to re-calibrate the import, export and buffer reserves of commodities, facilitate custom clearance and better leverage international and domestic markets and resources, to more effectively ensure supply and keep prices stable.
Market regulation will be strengthened. Industry associations should play their due role in enhancing industry self-discipline. The regulation of futures and spot markets will be better coordinated and targeted measures will be taken when appropriate to screen abnormal transactions and malicious speculations. Irregularities such as making and executing monopoly deals, spreading false information, price gouging and hoarding will be dealt with to the full extent of the law and brought to light.
Efforts will be made to maintain the stability of monetary policy and keep the RMB exchange rate broadly stable at an adaptive, balanced level, to guide market expectations as appropriate.
Assistance will be provided to help market entities, especially micro and small businesses and self-employed individuals, cope with rising costs and other difficulties in their production and operation.
Since the beginning of this year, due to multiple factors especially the transmission of global price rise, some commodities have seen extended price rally, with the prices of some varieties hitting new records.