China's consumer price index jumped 4.4% in October - a 25 month high. Runaway inflation has led to higher prices across the board at China's markets. 100rmb (~$15) today will now buy 30 fewer apples compared to the same time last year.
BEIJING – Recent reports on inflation in China’s food prices are usually followed by a healthy debate between foreign and domestic experts on how to deal with the reported 10.1% year-on-year inflationary increase.
The question of China’s artificially low interest rates and currency and its effects on economies will be left for another day. However, we would like to call your attention to the always interesting China Hush pictorial on what 100 yuan (~$15) will buy you at the grocery store today compared to a year ago.
Since October 2009, there has been an 18% rise in the cost of fruits and vegetables. That number goes as high as 30% in some provinces. As a result, the price of, say, a Fuji apple in Beijing has risen from 3.95 yuan/kg in 2009 to 5.94 yuan/kg today.
This results in a surprising 30-apple cut in your buying potential.
Similarly, Beijingers now find that 100 yuan buys them 90 fewer eggs, 6 kilograms less of garlic and 200 grams less cooking oil than a year ago.
It’s not just everyday people feeling the economic pinch, McDonald’s has announced an 8% increase in the price of their Big Macs. Meanwhile, Patrick Chovanec of the Forbes China Tracker anecdotally captured Kentucky Fried Chicken’s price uptick in a blog post this past August:
How does my KFC experience in Beijing compare? A year ago, my standard meal cost RMB 21.50. A couple of months ago it rose to RMB 25.50. Today, for the first time, it set me back RMB 28.50. For those keeping track, that’s a 32.6% price hike in a single year.
China as a nation is still very much food self-sufficient, and government officials have long carefully watched food prices as a possible prompt for social unrest. No small wonder then that in the last few weeks the central government has announced steps to curb inflation that include food subsidies for poorer families, cutting down on lending, halting hoarding practices by price speculators and promising to boost vegetable production.