Why are food prices rising at a slower rate than prices?

Summary: Why food prices rise faster than prices?

Before the scientific development of agriculture, I made a rough comparison of prices in the past ten years, and found a problem. The rising speed of grain prices was roughly 1.5 times, while other price levels were basically twice as fast, while prices like houses rose faster than rockets. Compared with the ten-year house prices in several places I know well, they basically rose more than five times faster.

And this asymmetry in the rate of increase is probably the reason why farmers generally feel that food prices are not rising or that food prices are very low. For farmers to think that food prices are very low, it is not that food prices are really very low, but that they appear low compared to other prices. From the current income composition of most farmers in our country, agricultural planting income still accounts for more than 90% of the total household income, accounting for the vast majority of families like this. So complaints about low food prices are understandable.

As far as the root causes of low food prices are concerned, this is universal all over the world, and low food prices are not only true in our country, but also in the whole world. And abroad, food prices are cheaper than China's food prices, which is also an indisputable fact, for example, the price of corn in the United States is 5 cents, soybeans in the appearance of 1.2, are much lower than our country, and slow down the process of China's food prices is also a lot higher than the international food prices themselves, so after China's accession to the WTO, China's food prices will be difficult to rise in the short term, and even appeared stagnate, the rate of inflation can not match other prices situation.

Secondly, the economic benefits of farmers planting small-scale cash crops in our country are also low, and they think that the current state of grain prices cannot obtain high economic benefits. For example, the cost line of planting corn abroad has a very good profit when it is sold at 3 cents per catty, while the cost of grain planted by Chinese farmers is 7 cents per catty, and the high cost price naturally makes farmers feel that it is difficult to obtain economic benefits from planting. In international competition, if the same market price is used to circulate, the market competitive advantage of American agricultural products will naturally be greater. In the case that American grain still has profits, China's grain price is also out of a loss situation.

The solution to solve the current low planting benefit is to seek a breakthrough, take large-scale planting and increase agricultural subsidies, so as to improve farmers 'enthusiasm for planting. At present, China has accelerated the process of land circulation, and many farmers who have taken the lead in awakening have begun to shoulder the banner of land leasing, planting land on a large scale, reducing agricultural production costs and achieving higher economic benefits.