In fact, half of inflation is caused by food shortage; For some time, the supply of agricultural products in China has been affected. Mainly since 1988, China's grain output has been greatly reduced, reaching only 860 billion kilograms in 2003, while the demand is generally between 960 billion and 980 billion kilograms. Demand exceeds supply and prices are bound to rise. Since 2004, China's grain output has increased substantially, but it has basically maintained a generally balanced state, and grain prices have remained at a higher level than before. In 20 10, the national summer grain output decreased by 800 million kilograms, and the dry rice output decreased by 400 million kilograms, which led to the increase of agricultural products, which reflected the demand-driven inflation, natural disasters (snowstorm in the south, Wenchuan earthquake, southwest drought and Yushu earthquake), small-scale climate increase, and the change was that agricultural products were out of touch, leading to the increase of food prices. Moreover, some people hoard goods in large quantities and raise prices to profit from them. Rising grain prices are the main factor of rising grain and oil costs, that is, the impact of inflation.