In the second quarter of 2005, China's grain price fell for the first time in recent years, which experts believe will reduce incomes in rural areas, the Beijing-based Economic Information Daily said on Friday.

Thanks to a 26.4-percent rise in the grain price last year, China's rural population per capita cash income increased 12.5 percent during the first half of 2005, Zhang Haiwang, an official with the National Bureau of Statistics (NBS) was quoted by the newspaper as saying.

The number of the migrating rural labor force grew at a slower pace this year, so the grain price drop will definitely affect the stable growth of farmer's income, Zhang said.

NBS statistics show that the market grain price suffered a year-on-year decrease of 1.7 percent in April, 1.6 percent in May and 1.1 percent in June.

The fall of grain prices also affected the consumer price, of which the food price makes one third. The first two quarters of 2005 witnessed a mere 2.3-percent rise in the consumer price, 1.3 percentage points lower than the same period last year.

Zhang suggests related sectors, particular state-owned grain companies, should buy more foodstuff to add to the storage at the bottom price set to protect the farmer's interests.

(Xinhua News Agency August 7, 2005)