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SHENZHEN: Guangdong's provincial government will take interventionist measures to stabilize the soaring price of grain, local officials said at the weekend.

Five local government agencies, including the price bureau, development and reform commission, and the grain administration on Sunday jointly issued an emergency scheme to deal with abnormal price fluctuations. It will come into effect tomorrow.

The scheme will be activated in the event that half of the regions in the province record a cumulative 50 percent increase in the grain price in a single week, and the situation lingers for no less than 15 days.

It will also come into effect if half of the regions record a cumulative 100 percent increase in a single week.

However, the emergency measure can only be initiated with approval from the provincial government, an official from the Guangdong price bureau told reporters after the release of the new policy on Sunday.

Under the scheme, the government can set a maximum retail price for grain, based on people's ability to pay, the historical price record and the prices in neighboring regions.

Grain processing companies, wholesalers and retailers will be given subsidies by the government if the maximum retail price does not offset their costs.

Local governments in Guangdong have been advised to use their grain reserves appropriately to ensure a steady market supply and stabilize prices.

The intervention measures will be announced at press briefings when the emergency scheme is activated, an official from the price bureau said.

The bureau will also regularly publicize the grain price and market information on supply and demand.

However, the scheme was by no means an indication the grain price was set to rise again, bureau officials said.

Figures from the price monitoring center in Guangdong showed the wholesale price of grain rose slightly in June, while the retail price remained unchanged from May.

The center also forecast the grain price would go up slightly in the third quarter, but the overall situation would remain stable.

(China Daily 07/31/2007 page5)