Producer Price Index of agricultural products in China Q1 2019-Q1 2024

In the first quarter of 2024, the Producer Price Index (PPI) of agricultural products in China ranged at 96.1 index points (same quarter of previous year = 100). After a considerable price decrease between the first quarter of 2020 and the third quarter of 2021, inflation picked up in the second and third quarter of 2022, mainly driven by rising pork prices, but also supported by a price increase of farm crops. During 2023, agricultural prices decreased again.

The Producer Prices Index

The Producer Price Index (PPI) measures the average change in selling prices received by domestic producers for their output. In combination with the Consumer Price Index (CPI), the PPI is used as an indicator to identify economic inflation or deflation. In contrast to CPI, which measures price levels of end consumers, the PPI measures the output price change from the perspective of sellers. In this sense, the Producer Price Index of agricultural products reflects changes in selling price received by farmers.

Agricultural producer prices in China

According to the graph at hand, producer prices for agricultural products picked up considerably in the second quarter of 2019. Inflation peaked in the first quarter of 2020 and fell back to a normal level in the fourth quarter of 2020. This development was mainly caused by an increase of Chinese producer prices for livestock, which were driven by the outbreak of the swine fever in 2019. The PPI for fishery in China fluctuated only slightely at around 100 index points during the same period, while producer prices for forestry products in China even saw a partially negative price development. During the third quarter of 2022, however, prices for livestock products grew considerably, while prices for farm crops in China indicated a moderate price increase.