China Sparks “Panic Buying” After Telling Households To Stockpile Food Ahead Of Winter
Central planners are at it again. In September, China ordered the country’s top state-owned energy companies to secure supplies for this winter at “all costs.” Now they’re telling households to stockpile food ahead of winter, sparking wild conspiracies among netizens about heightening tensions with Taiwan.
According to Bloomberg, the Ministry of Commerce told households Monday to stock up on food in case of emergencies after a resurgence of the virus pandemic, heavy rains that sparked vegetable prices to jump, and the onset of colder weather.
The commerce ministry directive is similar to the one released ahead of the holidays at the start of October, which told local governments to secure food supplies. The order comes as a coronavirus outbreak prompted fresh lockdowns.
The directive was released on the government’s Weibo account, a similar platform to Twitter, stated: “Ministry of Commerce encourages households to stockpile daily necessities as needed.” It had more than 17 million views as of Tuesday. Some netizens were concerned that an impending invasion of Taiwan was the reason for the stockpiling directive.
“As soon as this news came out, all the old people near me went crazy panic buying in the supermarket,” wrote one Weibo user.
The Economic Daily, a Communist Party-backed newspaper, told netizens not to have “too much of an overactive imagination,” adding that the directive’s purpose was to make sure citizens could feed their families in case of a lockdown.
The weather has been a significant concern in China. China Meteorological Administration (CMA) warned last month of a La Nina weather pattern which has already brought in the first round of cooler weather.
Temperatures across China are plunging, and the power crisis is worsening as demand for electricity generation ticks higher, straining coal supplies. However, on Tuesday, China National Radio quoted Vice Premier Han Zheng, who said coal-fired electricity generation should be normalized, which means power rationing across 20 provinces and regions making up more than 66% of the country’s GDP should subside.
Extreme weather in early October also destroyed crops in Shandong – the country’s largest vegetable growing region – threatened to disrupt food supply chains. At the end of October, broccoli, cucumbers, and spinach prices more than doubled in weeks.
The commerce ministry told local governments to purchase vegetables that can be stockpiled in state-owned freezers to provide adequate supplies if shortages develop.
According to a state TV report late on Monday, China also plans to release vegetable reserves “at an appropriate time” to prevent soaring food inflation.
The biggest problem with centralized governments is when they issue directives such as this one, people generally panic buy, sending prices of goods, such as vegetables, through the roof.
All of this will reinforce our thesis, that we’ve laid out for the entire year that global food prices will remain at record highs. If this winter is exceptionally severe in the Northern Hemisphere, there could be worldwide shortages of certain farm goods. China is being proactive in supply chains management.
So what does this mean for the average American – it’s probably time to stockpile as well.
Tue, 11/02/2021 – 09:30