Will high price imported pesticide face any policy risk?
The prices of the imported pesticide are on the rise in the recent years. Will thiscontinued price rise face any policy risk?
imported pesticide, imported commodities, price rise, price control, policy riskRecently, the Chinese government has been closely monitoring the price variations in theimport commodities, such as milk powders and medicines, with a view to protect the commoncitizen against unfair prices. In recent years, the price of imported pesticide has risenabnormally. Will this continuing price rise face any policy risk?Price variations have an influence not only on people's life, but also on national stability. Thus,the government has the responsibility to take steps against price rise when the price has risenat unacceptable rates. Over the past years, the prices of imported commodities, such as milkpowders, cars and medicines have soared leaving consumers puzzled. Finally, the Chinesegovernment had to take steps against price rise, giving most of the foreign companies asevere hit.Lately, the market share of imported pesticide is on the rise, so does the price. As a result,price rise of imported pesticide has become farmers' burden. Under this situation, if the price of imported pesticides increases again, will the government try to regulate?It is believed that the government of China would not take any measure for price control of these imported pesticides in the near future.Firstly, compared with the industries mentioned above, domestic pesticide market is very small,whose annual sale is only around USD8.1 billion to USD9.8 billion. It's quite reasonable,pesticides are a kind of product specifically for specific people--the farmers, and the smallaggregate demand determines its low impact on people's daily life in a short term. Additionally, domestic pesticides would be the back-up choice to hit back the rising price of imported pesticide. China is the biggest producer of pesticide in the world. If farmers don't likeimported products, they can choose the much cheaper homemade products.On the other hand, the imported pesticide is well received by farmers. Presently, the marketshare of domestic pesticide has been declining year by year; conversely, the amount of theimported pesticides is rising. According to the data from China Customs, totally 35,639 tonnesof pesticides have been imported from January to May in 2013, up by 6.9% compared to thesame period in 2012. Even though the price of imported pesticide is rising, some farmers or agencies prefer the high price imported pesticide rather than the domestic pesticide, theimported pesticide is accepted by more and more farmers at the moment.There are multiple reasons for this. Firstly, the imported pesticides are believed to be more