英语文摘:Adverse weather may disrupt China's control on prices

Meanwhile, analysts pointed out that the current bad weather might prompt expectations of higher prices of agricultural products and thus trigger speculation, which will drive prices higher and add to the risks of inflation.

Wheat futures for September 2011 delivery at the Zhengzhou Commodity Exchange closed at 2,822 yuan (428.64 U.S. dollars) per tonne on Wednesday. The closing price on December 27 last year was 2,751 yuan per tonne.

Shen Hongyuan, an analyst with the China Zhengzhou Grain Wholesale Market, said the price increase is due to the dry weather. There is also a possibility that speculation plays a role in lifting prices, he added.

Li Guoning, general manager of a grain and oil purchasing company based in Hebei, said weather and government policies affect the market price of wheat. If drought lingers into March, it will be a factor used by speculators to push up prices, he said.

Hao Deyou, a researcher with the Hebei Provincial Academy of Agriculture and Forestry Science, said the government should closely monitor the weather changes and work to prevent price hikes due to speculation on drought.

Patrick Chovanec, associate professor at Tsinghua University, said the key reason for China's inflation is still excess liquidity, rather than lack of water.

"It is always easy to blame weather for price hikes," he said, arguing the government should move further on tightening to reduce money supplies in order to stabilize prices.