China's Grain Price Transmission Mechanism In Market Economy

Grain is the origin of the people's livelihood, the price of grain is a price foundation and food policy for the country. In the grain policy, grain price policy occupies a key position. Improper grain price fluctuations damage people's livelihood and social stability. Therefore, our government has always attached great importance to the stability of grain prices. However, since the end of 2006, China's grain prices have continued a clear rise.Traditional theory of supply and demand model and web theory prove hard to explain the phenonminon. Considering the particular background of China's long-term regulating grain market, the long-term man-made price difference between agricultural and industrial products, the round of grain price rise has its inherent rationality. Through the cost of grain, the international grain prices and domestic factors such as CPI on China's grain price transmission mechanism, the writer analyses of these factors on grain prices and find that self-sufficiency rate and grain reserves play an important role in the stability of grain prices. Therefore, in the last chapter, the writer discusses that we should have a reasonable self-sufficiency rate of grain and grain reserves size to maintain the stability of China's grain market, and suggests use CPI index increase as the warning level on the price of grain increase to monitor food prices.Grain prices relate to national harmony and stability. Stabilizing the grain prices, and at the same time ensuring that the grain prices moderate and controllable are important tasks for grain market reform in China, and also what this paper to try to resolve.