China-Singapore Jingwei Client, February 10 (Xiong Jiali) On the 10th, the National Bureau of Statistics will announce the Consumer Price Index (CPI) for January 2021.
Many institutions predict that the CPI in January will increase or decrease year-on-year, from positive to negative.
Institutional forecast average growth rate -0.1%
In December 2020, national consumer prices rose by 0.2% year-on-year.
Dong Lijuan, a senior statistician in the City Department of the National Bureau of Statistics, previously analyzed that in December, food prices changed from a 2.4% drop in the previous month to a 2.8% increase, which affected the CPI increase by about 0.62 percentage points.
In food, the production, storage and transportation costs of fresh vegetables and fruits have increased due to the continuous low temperature weather, and prices have risen by 8.5% and 3.5% respectively.
For the upcoming CPI data for January 2021, Wind data shows that as of February 9, 12 institutions have predicted an average of -0.1% for January CPI year-on-year increase.
Among them, the highest forecast value is 0.4% given by Shanghai Securities and CICC, and the lowest is -0.7% given by China Merchants Securities.
Haitong Securities pointed out that the CPI is expected to turn negative year-on-year in January.
The prices of eggs and vegetables rebounded significantly in January this year, driving the prices of agricultural products to rise sharply.
In terms of non-food products, due to the intertwined and superimposed situation of sporadic and locally clustered epidemics in the recent domestic epidemic, terminal consumer demand has been suppressed and the recovery momentum has been weak.
Under the influence of a higher base in the same period last year, it is expected that the CPI in January 2021 will turn negative again to -0.2% year-on-year.
According to an analysis by China Development Bank Securities, in the short term, despite the short-term rebound of pork prices, consumer demand is still recovering moderately, especially the impact of the increase in the epidemic in winter compared with the previous period on the catering industry, superimposing the high base of CPI from January to February 2020 (Above 5%), the CPI from January to February 2021 may fall back to around -0.5% year-on-year.
Pork and egg prices fall from high levels
Dong Lijuan pointed out that in December 2020, with the arrival of the New Year's Day and the Spring Festival, consumer demand increased seasonally and feed costs increased. Pork prices changed from a 6.5% drop in November 2020 to a 6.5% increase.
According to data from the Ministry of Agriculture and Rural Affairs, in January 2021, the average wholesale price of pork was 46.69 yuan/kg, a month-on-month increase of 7.3%.
The wholesale price chart of pork.
Source: Ministry of Agriculture and Rural Affairs website
The National Development and Reform Commission stated on February 9 that at present, the supply of grain, oil, meat, eggs, vegetables in various markets is sufficient, and the consumer demand of residents has a solid material guarantee. The prices of pork and eggs have fallen. On February 8, the retail of pork and eggs in 36 large and medium-sized cities across the country The prices were 29.8 yuan and 5.3 yuan per catty, down 2% and 7.6% respectively from the previous highs.
In the next step, the National Development and Reform Commission will instruct all localities to continue to closely monitor market supply and price conditions and take timely measures to ensure supply and price stability.
Haitong Securities pointed out that the traditional consumption peak season for the Spring Festival is approaching, and the National Development and Reform Commission has organized the central reserve meat to be released at a rhythm of 20,000 to 30,000 tons per week since December 17 last year, and the release of local reserve meat has continued to increase, and the supply continues to increase. Makes pork prices fall for two consecutive weeks.
The current stock of breeding sows and the year-on-year growth rate are at a high level.
In the context of sufficient supply and stable expectations, pork prices are expected to continue to fall.
In addition, agricultural and sideline foods such as grain, oil, meat, eggs, vegetables, etc., are sold at parity through government subsidies in many places.
In addition, in response to the recent increase in vegetable prices in some places, the Ministry of Agriculture and Rural Affairs stated that overall, vegetable price fluctuations are still dominated by seasonal increases, which are normal price fluctuations during the Spring Festival.
The sown area of winter and spring vegetables nationwide and the average monthly market volume increase steadily, and the market supply is sufficient.
How will CPI go in the future?
Guolian Securities stated that although pork prices have picked up due to seasonal factors in consumption and increased feed costs, it will not change the general downward trend of the pig cycle. It is expected that the subsequent CPI will remain low overall.
Guotai Junan said it expects the CPI to weaken from the previous month on a margin in February.
From a historical perspective, as the Spring Festival approaches, the price of most agricultural products has risen less and less month-on-month, the most typical being vegetables and fruits.
Based on the seasonality of previous years, the high absolute level and recent trends, it is expected that the moment of the largest month-on-month increase in agricultural product prices has passed.
It is predicted that the possibility of a month-on-month increase in the CPI in February is very small.
(Zhongxin Jingwei APP)
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