China says seasonal fluctuations, not floods, behind vegetable price rise

BEIJING (Reuters) - Recent vegetable price increases are due to seasonal fluctuations and are not the result of flooding at a major vegetable growing region in eastern China, the country's Ministry of Agriculture and Rural Affairs said on Tuesday.

The statement was issued to address the rising vegetable prices and comes at a time when inflation in China has moved somewhat higher over the past two months. Inflation concerns at the same time as general economic dislocations because of the trade dispute with the United States are likely to worry the central government.

The flooding in the city of Shouguang in the eastern province of Shandong will not push up national vegetable prices significantly as output there is small during the summer, the statement said, citing Tang Ke, the director of the ministry's market and economy information department.

The region around the city produces about 0.5 percent of China's vegetables, according to Reuters calculations based on output data from the National Bureau of Statistics (NBS) and the Shouguang statistic bureau.

The average wholesale prices of 28 vegetables, including carrots, spinach and eggplants, among others, were at 4.19 yuan ($0.6095) per kilogram last week, up 11.7 percent from the first week of August, according to ministry data.

Last week's prices were up 10.8 percent from a year earlier, and are 9.1 percent higher than the five-year average, the agriculture ministry said.

A separate statement from the Ministry of Commerce on Tuesday said lettuce prices last week rallied 26.3 percent from the week before, while green beans and cucumber jumped 14.8 percent and 13.8 percent respectively.

Shouguang was hit by heavy rains and flooding earlier this month.

China's vegetables prices were usually high in July and August and increases this year were due to flooding and natural disasters in major production areas earlier, which had a bigger impact on the growth, harvest and transportation of vegetables, the statement said.

Vegetable prices are expected to stabilize and fall later this year as supplies will recover. But prices of eggplants and peppers might rise in late September and early October, as the Shouguang flooding impacted greenhouses where the two plants are grown, Tang said.

($1 = 6.8740 Chinese yuan renminbi)

(Reporting by Hallie Gu and Josephine Mason; Editing by Christian Schmollinger)