Economy

China to set up prices, competition agencies to curb market manipulation

(Xinhua)
Updated: 2010-07-02 11:23

BEIJING - China's National Development and Reform Commission (NDRC), the country's top economic planner, announced Thursday that it will establish two offices dedicated to preventing anti-competitive behavior in markets.

The two offices, the Anti-Monopoly Office and the Market Price Supervision Office, will control monopolistic behavior and curb market manipulation, said Xu Kunlin, chief of the NDRC's Price Department.

The announcement came the same day Chinese authorities fined a number of farm produce traders in northeast China for conspiring to push prices higher.

Government agencies, including the NDRC, the Ministry of Commerce, and the State Administration of Industry and Commerce, jointly issued a statement Thursday saying a number of companies were fined because of their speculating to increase prices.

Xu Kunlin said wholesaler Jilin Corn Center Exchange Ltd, based in northeast China's Jilin province, had invited more than 100 mung bean dealers from across China in October last year to a conference concerning the mung bean production situation in China.

The company later fabricated a report claiming "Output in major mung bean production regions fell 64.05 percent in 2009 year on year".

This, though, contrasts with the official figure of a 14.9 percent decrease, Xu said.

Copies of the report were also provided to participants of the meeting.

Speculation has been blamed for the greatly increased prices of some agricultural products in China this past May.

The price of mung beans, for example, soared, from nine yuan ($1.32) per kilogram in October in 2009 to 20 yuan by May.

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Xu said the Jilin Corn Center Exchange Ltd has been fined 1 million yuan ($147,000) for market manipulation.

Three other companies that co-hosted the conference also received fines ranging from 300,000 yuan to 500,000 yuan.

The price of mung beans has now fallen to about 13.5 yuan per kilo, down by more than 30 percent compared to the earlier price hikes. Meanwhile, prices of vegetables have also begun to decrease since May, the statement said.

The NDRC has been working to prevent inaccurate reports of prices as it works to restrain expectations of inflation.

On June 11, NDRC officials criticized a Beijing newspaper for running an "untrue" story about a garlic speculator who spent millions of his profits to buy gold.