The following analysis of domestic prices for soybean, maize, japonica rice, and wheat in China is based on (i) nationwide monthly grain price data between December 2006 and December 2016 provided by the price information center of China’s National Development and Reform Commission (NDRC) and (ii) price trend forecasts and early warning obtained by Fang Jingxin’s price-spiral model, in addition to other national and international ancillary data sources. The outlook is as follows:

• Soybean. According to data for the last six months, the international consumption ratio for soybean is at equilibrium. Domestic soybean prices are also at equilibrium but fluctuate around the trend line; fluctuations are expected to amplify.

• Paddy rice. As a result of the changing relationship between supply and demand, the recent downward trend for the price of paddy rice in China will slow down. For now, the price has returned above the trend line; if it can keep this position for five months, it is assumed the upward price trend will continue. (See figure 4.x)

• Maize. Maize prices have hit bottom, and the consumption rate has entered the non-equilibrium interval. This shows that the supply and demand situation is conducive to recovery. An early warning is made for the reversal of the declining price trend.

• Wheat. Current prices and consumption rates are at equilibrium. It is expected that the decline will gradually calm down to above the trend line. Similar to the situation for paddy, if the price position can be maintained for five months, an upward trend for the price of maize is assumed.

Figure 4.11. Fluctuations in the price of paddy rice, December 2006 to December 2016