CCTV:
What is the current state of supply of daily necessities, such as grain, oil and vegetables, across the country? What is the price of these goods now? As the Spring Festival holiday ends, the demand for meat, eggs, milk and daily necessities is increasing in large and medium-sized cities, but many small and medium-sized enterprises are still operating below their normal productive capacity. How can we secure a stable supply of daily necessities? Thank you.
Lian Weiliang:
To measure the supply of daily necessities, price is the most important benchmark. You mentioned the price of goods in your question, so I guess you understand the key point. Data from supermarkets and marketplaces in 36 large and medium-sized cities on Feb. 2 shows that the average retail prices of pork, beef, lamb and eggs have dropped by 0.3%, 0.6%, 0.8% and 1.3% respectively from their previous highs. The data also shows that the average price of 15 different vegetables dropped by 6.2%. Although some products such as chicken saw price increases, the fluctuation margin is still acceptable. Taking Wuhan in Hubei province as an example, the prices of some daily necessities surged when traffic control measures were implemented. However, prices have now fallen. The price of pork in supermarkets and marketplaces has dropped by 0.7% from its previous high. The average prices of 15 different vegetables dropped by 3.8% while the prices of beef, lamb, chicken and eggs remained the same.
From the supply perspective, most of the necessities across the country, especially the supply of food, are guaranteed. China's total grain output remains stable and has surpassed 650 million metric tons for the fifth consecutive year. We have a sufficient supply of stock. The stock of rice and wheat from all enterprises has surpassed China's total domestic consumption in a year. The production of beef, lamb, poultry and eggs has also increased to varied extent. Pork production has steadily recovered. Regarding the supply of vegetables, we also have an adequate inventory. The cultivation area of vegetables exceeded 5.6 million hectares, an increase of 2% year-on-year, and the output is estimated to increase by over 2%. There are some short-term supply shortages in some areas which are mainly caused by the difficulty in distribution due to the strict implementation of epidemic prevention and control measures. Several areas still face problems with the timely distribution of vegetables to markets. We are addressing these problems with targeted solutions.
With respect to daily necessities, in particular food, our supplies are sufficient. Everybody knows that China's food-processing capacity is very large, and its utilization rate is very low under normal circumstances. As long as production resumption and logistics distribution are well organized under the strictly-implemented measures for epidemic prevention and control, the provision of food and other living supplies will not be a problem.
In response to the resumption of work and production, as well as preparing for a potential increase in peoples' living needs after the Spring Festival holiday, we will focus on four areas of our work: increasing supplies, stabilizing prices, maintaining good social order, and prioritizing the needs in key areas.
In view of increasing supplies, we'll ensure that they will be provided to a level that exceeds normal demand. In other words, we'd rather have excessive stockpiles, which may be little or not used at all, than face shortages. By strictly following prevention and control measures, we will give priority to increasing supplies, cooperating with labor organizations to ensure that the workforce returns to their jobs and restarts production as well as to guarantee the smooth operation of logistics. For instance, we are jointly working with six provinces neighboring Hubei to secure an adequate supply of local vegetables. So far, there are nearly 60,000 metric tons of vegetables in the inventory, which can ensure a sustained supply of about 8,000 metric tons to Wuhan every day. In addition, the storage of 10,000 metric tons of frozen pork from the central reserve in the Shanghai Port is ready to be sent to Wuhan when needed.
To secure stable market prices, we will closely monitor the price indicators of daily necessities. Once there are obvious fluctuations, we will find the causes and launch targeted measures, especially the plans to guarantee constant supply.
To maintain stable social order, we'll continue to keep a close eye on the market, punishing those who violate the laws by spreading price-hike rumors or scheming or colluding to drive up prices. In particular, product quality supervision should be strengthened and we will impose severe penalties on people who sell counterfeit or shoddy products in accordance with the law.
Regarding our priorities in the key areas, we will prioritize demand from Wuhan, from Hubei as well as from severely affected regions where efforts to prevent and control the disease have been strained.
All authorities are coordinating and cooperating with each other in line with their respective roles and duties. Now, the Ministry of Commerce (MOC) and the State Administration of Market Regulation will give you more specific information. Thank you.
Wang Bingnan:
I'd like to say something more about this issue. The supply of daily necessities has been affected to some extent since the outbreak of the epidemic. Over the past few days, some regions have faced a temporary shortage in daily necessities and the intensified situation has drawn great concern from governments at all levels. To address the problem, the MOC has joined hands with the National Development and Reform Commission as well as local governments to take immediate action by asking the retail sector to increase the frequency at which they restock. Now, the situation seems to have been alleviated. According to the data monitored by the MOC, the supply of daily necessities is sufficient and their prices remain stable.
In addition to safeguarding supplies across the country, we have prioritized the demand from Hubei province, and of Wuhan in particular. The MOC has mobilized other cities and provinces to lend a helping hand to support Hubei through its difficult time. So far, the supply of daily necessities to Hubei has increased and the sales and inventory of vegetables have been restored to their normal levels. According to the Wuhan Administration of Commerce, on Feb. 2, the two biggest wholesale markets — Baishazhou and Sijimei — had 8,772 metric tons of vegetables in their combined stock. The three chain supermarkets —Wushang, Zhongbai and Zhongshang — had a stockpile of 2,155 metric tons of vegetables on Feb. 1, up 19.2% from three days earlier. At the same time, retail prices fell by 14%.
As you mentioned in your question, the demand for daily necessities in medium and large cities will continue to grow after having been affected by the prolonged Spring Festival vacation and the rush of people returning to work in the cities. Moreover, the logistics in some regions remain bottlenecked, there is a shortage of staff in commercial and trade companies and the capacity of small and medium enterprises cannot develop to its fullest extent. The MOC has placed great importance on these problems. We resolve to implement the planning decisions by the Central Committee of the CPC and the State Council, focusing on addressing problems and upholding bottom-line thinking. We have already made a plan to further guarantee the supply of daily necessities, mobilizing and directing the personnel involved in this issue to be more accountable for their work in the different regions. In this way, we will ensure that local markets keep a stable supply of necessities and goods.
We are carrying out work in the following four areas:
First, we are organizing and mobilizing people and entities to resume work. We call on local governments to encourage small and medium-sized businesses to open their doors and start operations as soon as possible. This would include getting staff to return to work; implementing internal prevention and control measures such as ensuring adequate ventilation, disinfection, and professional guidance for personnel at offices and work sites; and increasing the supply of basic living services such as shopping and catering for the public. I emphasize here that in the face of this developing epidemic, all local governments must conduct timely and full evaluation as well as hierarchical management and control. They cannot arbitrarily stop or close food markets and other places of business operation but must ensure the steady supply of daily necessities for the people.
Second, we need to strengthen joint guarantees and joint controls. We will strengthen the cooperation mechanism for joint guarantees and controls in Hubei and the surrounding nine provinces, autonomous regions and municipalities, and further mobilize all forces to ensure the steady supply of daily necessities in Hubei province, especially in Wuhan city. Director Lian just said that over the last few days, Shandong, Chongqing, Guangxi, Jiangxi, Yunnan and other places have transported more than 2,000 metric tons of vegetables to Wuhan, alleviating the tight supply situation there. The Ministry of Commerce will also send a special working group to Wuhan to carry out on-site coordination and guidance in response to any new situations and problems that may affect the local market supply.
Third, we need to do a good job in matching demand with existing supplies and ensuring that supplies are transported to the areas in need. The Ministry of Commerce has identified a number of key companies which can help in the nation's effort to guarantee the steady supply of goods and necessities and has also established a guarantee mechanism for hundreds of large-scale distribution companies. As of Feb. 1, the 50 large agricultural wholesale markets across the country could transfer vegetables and other goods in a relatively large scale to the areas in need. We compiled daily statistics: On Feb. 1, there were 30,000 metric tons of vegetables, 12,000 metric tons of meat, and 268 metric tons of eggs that could be transferred to other places. Once demands are raised by localities, the Ministry of Commerce will immediately organize the process of matching supplies with their needs and start the transportation of goods and necessities to affected areas so as to meet their demands as soon as possible. Regarding the problem of logistical bottlenecks in some areas, the State Council has made it clear that all localities must not block the passage of daily necessities without its prior approval.
Fourth, we will strengthen monitoring and guidance. We will make further efforts to ascertain the maximum supply of key daily necessities such as vegetables, find and handle abnormal situations in which certain items go out-of-stock in a timely way. We will release information about market supply, guarantee of supplies and price stabilization, strengthen guidance, stabilize expectations, and strengthen consumer confidence.
