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Price of agricultural produces plays a decision role to reflect the overall
price trend in the Chinese market. It is considered as the price foundation
among all commodities and result in volatility in overall price level. In recent
years, rapid development of national economy and urbanization boost the price of
agricultural produces. Three main types of agricultural produces include cereal
(wheat, rice and corn), oil-bearing crops (rapeseed, soybean and peanut) and
vegetables will be analyzed in this report. Purchasing Price Index (PPI) will be
used to analyze the price of these main agricultural produces.
The report will process factor analysis of increasing agricultural produces
prices and list five main reasons influencing change in price, such as:
- Total costs
- Transportation cost and multifarious circulation links
- Minimum cereal purchasing prices
- Urbanization and change in consumption structure
- Adverse weather condition and natural disaster
By adopting Grey Markov Forecast Model, it is predict that PPI of cereal will
increase steadily for a long time. However, oil-bearing crops’ PPI will face a
sharp decline from 2014 to 2015. Finally, at the end of this report, it will put
forward four suggestions in order to stabilize price of agricultural produces as
well as prevent and cope with the effects of inflation.
1 Introduction 1
2 Price change 2
2.1 Purchasing Price Index (PPI) of major agricultural produces in 2009-May 2014
2.1.1 PPI of corn and rice kept constant increase and PPI of wheat declined in
May 2014 2
2.1.2 PPI of rapeseed and soybean remained stable and peanut's slightly declined
in May 2014 5
3 Factors 8
3.1 Total cost 8
3.2 Transportation cost and multifarious circulation links 12
3.3 Minimum cereal purchasing prices 14
3.4 Urbanization and change in consumption structure 16
3.5 Adverse weather condition and natural disasters 19
4 Future trend 21
5 Conclusion 24