Ye Tan: Three Breakthrough Prices

At the beginning of the reform and opening up, canceling the coupons such as grain coupons, cloth tickets and coupons were the first time for prices to break through. In the late 80s of last century, solving the dual price system of prices and liberating consumer prices were the second breakthrough in price to solve the difficult problems of market system, price distortions and high energy consuming society.

Following the pace of tax and fee reform, natural gas and other resource prices have been rising steadily since 2005, marking the third time that prices have been breaking through.

But in the process of breaking through the customs, they encountered the obstruction of monopolistic pricing and the unsmooth market system.

The reasons for the failure can be summed up as follows: administrative means inhibit prices, the pricing system between the one or two markets is different, and the prices of monopoly enterprises are hard to marketization.

In order to curb prices, the government adopted temporary administrative measures to curb prices since the second half of this year.

The result of forced underpricing is that there is a massive price upside down phenomenon, and prices are forced to suppress and rebound at any time.

Take the edible oil market as an example.

In December 2nd, the national development and Reform Commission interviewed four edible oil giants such as COFCO, Yihai, 93 and Zhongfang, and put forward two requirements for ensuring supply and stabilizing prices.

As the market share of the four edible oil giants is around 60%, the government controls the price of edible oil in the whole country during the holiday season by controlling the prices of large enterprises.

Edible oil plants, because of the price inversion, are motivated by economic rationality.

The cost of imported soybeans reached 10300 yuan to 10400 yuan per ton of edible oil producers imported genetically modified soybeans.

According to the wholesale price of domestic cooking oil from 9700 yuan to 9900 yuan per ton, enterprises will lose about 500 yuan for each ton of oil sold.

The oil plant may reduce production, or sell soybeans directly locally, so as not to lose money to earn money.

More than just the edible oil industry, as long as the price system is not smooth, there is a price increase impulse, the fundamental reason is that the price between the one or two markets is not smooth.

Take the real estate adjustment as an example, the monopolization of the land market, the liberalization of the two level market, the rising of the land prices in the primary market, and the rise of the prices of commercial housing and commercial real estate in the two tier market.

2010 is the year of real estate regulation and control. Under the background of intense regulation and control, the land finance of the first tier cities has reached a record high.

Another example is thermal power enterprises. In the first three quarters of this year, most of the five major power generating groups in China were mainly losing power generation business. Only the Huaneng and Guodian power companies were profitable, and the remaining three were in deficit. Among them, five of the thermal power businesses were fully damaged, with losses ranging from 500 million yuan to 3 billion yuan, while water and electricity and wind power earnings were in good condition.

The main body supporting the profit of electricity companies is coal, electrolytic aluminum, finance and so on.

The rise of coal prices and the administrative control of electricity prices are a difficult problem. The main business of the thermal power industry is losing. The power companies are not working properly, expanding to the electrolytic aluminum industry, acquiring the advantage of production cost with low price electricity, and challenging the market order of the electrolytic aluminum industry, resulting in the worsening of the high energy consumption situation in the aluminum industry.

Price inversion can be maintained for a while and can not be carried out for a long time.

In the case of price upside down, we have seen typical examples of enterprises. The most typical way is to reduce output, resulting in the contradiction between supply and demand of products in the future. The market for finished products and the edible oil market will follow suit.

Even if the enterprise raises the barbell for inflation, what will happen to the price after the Spring Festival after the Spring Festival?

The price of imported soybeans fell sharply, unless the economy cooled down linearly after the Spring Festival.

But economic contraction is likely to make people even more unaware. Economic contraction means employment rate is falling. This is another important matter of stability.

The pricing of monopoly industries is even more disordered. The government tries to raise the cost of oil and coal enterprises by collecting resources tax, and further raise the price of resources, so as to establish a market-oriented energy saving society.

The original intention is good, but encountered many obstacles in the process of price rising. The biggest difficulty is that the public can not distinguish whether the price rise of monopoly enterprises is the pricing process of the market, or whether the enterprises take advantage of the monopoly bonus.

In the process of urbanization, China's resources will always fall short of demand, and the rise in the price of resources will further boost inflationary pressure. In the face of the dual pressure of public opinion and inflation, the government has to be cautious when reforming the price of resources. This has led to monopolistic enterprises' dissatisfaction and believes that the government is too slow in advancing the pricing process of the market.

The interests of the cube are not satisfied with the pricing system. It must be the big problem of the economic development mode and the pricing system itself.

Only if we follow the two major laws, can we succeed in the current round of resource price entry. We can make the marketization industry complete from the upstream to the downstream, and temporarily unable to marketization.

The third price break is not the last time. As long as we can cultivate a market-oriented pricing entity, we can become an organic whole of the deep reform of China's market in the future.