Hong Kong prices up as dollar peg imports US inflation

HONG KONG, Feb 11, 2008 (AFP) – On the day before the Lunar New Year festival, almost every pork butcher in Hong Kong’s Wanchai market is frantically busy with queues of housewives and maids 10 deep. Family feasts to mark the new lunar cycle — this year the advent of the year of the rat — create the biggest annual spike in demand for pork here, and shoppers are muttering that prices are over-the-top.

“They (prices) are a little higher,” concedes one butcher, Sung, as his giant cleaver demolishes the fresh meat whichever way the picky shoppers are demanding.

When asked why, Song’s blade is temporarily still as he looks up.

“China,” is all he says.

Most of Hong Kong’s pork, the staple meat of the Chinese diet, and beef come from farmers in China, over the northern border, and until recently the supply of pork was controlled by just one company.

Being almost entirely reliant on imports makes the tiny territory of seven million people vulnerable to the whims of the authorities in Beijing whose priority is to protect their own supplies first.

China is currently short of pigs, after low prices in recent years and an outbreak of blue-ear disease meant they failed to keep up