The growth in pork prices which fuelled a surge in Chinese inflation last month may be about to slow – but that doesn't mean that the country's headache over rising food costs is cured. China's pork prices - which soared 11.4% in June alone, taking their year-on-year rise to 57% - will "stabilize" over the summer as pig production recovers, encouraged by high values, UBS analyst Tao Wang said.

The industry in on the way to recovering after high corn costs early last year prompted herd liquidation – creating a vicious circle of rising pork output and lower prices, which left a shortage of animals in its wake. Hog slaughter rates have been running some 10% below year-ago levels.

Chinese consumer price inflation hit 6.4% last month, up from 5.5% in May and 0.2 points higher than the market forecast, besides being well above a government target. Two-thirds of this increase reflected higher food prices, which overall rose 14.4% year on year. The pork price component alone contributed 1.4 points of the 6.4% reading.

UAIndex