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China urges strict local-level control of grain, fertilizer exports

(Xinhua)
Updated: 2008-05-01 09:33

The Ministry of Commerce has urged local authorities to strictly control grain and fertilizer exports and expand storage of farm produce to ensure domestic supply.

The ministry has issued a circular requiring effective and rigorous measures be taken to implement state policies of controlling grain and fertilizer exports, the ministry said on its website on Wednesday.

The move was China's latest effort to stabilize agricultural production and food supplies. Food prices soared 21 percent year-on-year in the first quarter, mainly driven by farm produce.

Authorities should expedite the granting of import licenses for edible oils and make it convenient for importers to buy more of the varieties that are in short supply, according to the circular.

Local officials must prevent unreasonable price hikes for farm materials, such as seeds, fertilizers and diesel, in the distribution process, it said.

The ministry directed that greater effort be made to establish local meat reserves and increase stockpiles of daily necessities like small-volume packages of grain, edible oil and meat at large enterprises.

Higher prices for meat, eggs and vegetables pushed the first-quarter consumer price index, a key inflation gauge, to an 8-percent year-on-year increase. The government has a target of about 4.8 percent for the CPI increase this year.

The government has decided to scrap export rebates for most grains and impose export duties of between 5 percent and 25 percent this year.

Also, an additional 25.25 billion yuan ($3.6 billion) was allocated last month, mainly to subsidize farmers' purchases of production materials.