Chinese city stews over rising cost of beef noodles
A global surge in food prices hits the popular dish.
By Don Lee Times Staff Writer 6:46 PM PDT, July 27, 2007
LANZHOU, China - Mention this city's name in China and people think beef noodles.
Once served only to royalty, hand-pulled beef noodles, or niurou mian, were brought out of the palace and into ordinary folk's homes about a century ago by Ma Baozi, a member of the Muslim ethnic minority group known as the Hui.
Today, more than 1,000 beef-noodle shops cater to this western industrial city of 3 million on the upper reaches of the Yellow River, far from the prosperous eastern metropolises of Shanghai and Shenzhen. Beef noodles are a staple here, a cheap, soothing way for workers who toil in petrochemical plants, oil refineries and heavy machinery factories to fill their bellies.
So when one shop after another bumped up the price of a bowl from 33 cents to 40 cents last month, it came as something of a jolt. Beef noodle prices had risen before, but never as much as 20% in one swoop. Many consumers, concluding that shop owners must have colluded, howled to the government.
"I have no option but to eat less," said Chang Xueqin, 43, who was laid off from an engine factory here several years ago and now drives a cab. "If it keeps increasing like that," he added, "in the end I'll eat like a monk."
But behind the stewing in Lanzhou is a global surge in food prices that is driving up the cost of everything from a latte at a Starbucks in L.A. to a tortilla in Mexico. Food prices worldwide have risen 23% in the last 18 months, according to the International Monetary Fund, partly because of soaring demand for corn to make ethanol.
With farmers shifting to grow more corn, they are producing fewer soybeans and less wheat. That's pushed up prices of grains that feed livestock and poultry, lifting the price of meats, eggs and other goods. Milk in the U.S. costs 10% more than at the start of the year.
In China, meat and poultry prices have increased 20% from a year earlier; eggs are up 28%. Besides higher grain prices, an outbreak of Blue Ear disease at pig farms cut into pork supplies, while growing incomes continue to bolster demand for meat, particularly along China's prosperous east coast.
Even the price of cheap instant noodles is up; Chinese media said it would rise this week between 20% and 40%, in part because the cost of palm oil, a major ingredient, had nearly doubled in the last year. Palm-oil prices have been driven up by rising demand for biofuel in Europe and strong demand from food sectors in countries such as fast-growing India.
In Lanzhou, the outcry over the hike in beef-noodle prices prompted the local government to cap the price of a bowl at 33 cents on June 26. Although many consumers cheered, officials and scholars in Beijing criticized Lanzhou authorities for trying to dictate prices in China's market economy.
The row over beef noodles has mushroomed into a national debate, and market forces seem to be prevailing over the government order: Most shops are defying the directive, since there is no penalty for violating the cap.
"The policy is not reasonable," said Ma Jianfeng, who serves up 700 bowls of noodles a day in the city's Xigu district, where the wave of price increases began. So far, he says, the added charge hasn't hurt his business much. A little before 5:30 a.m. Sunday, Ma sat in a booth dispensing noodle tickets to a steady trickle of customers. Steam rose from the kitchen.
"Because the cost is high, it's impossible to lower the price," said the 37-year-old, who like most owners of beef-noodle shops is an ethnic Hui. Hui people say running a small business is their only way up the economic ladder. If he followed the government order, Ma says, quality would suffer and that would mean the end of his livelihood.
"You would have less meat, less ingredients, less soup. Customers won't come here anymore."
Beef-noodle maker Wei De, 50, is also feeling the pinch. His biggest cost, beef, has jumped more than 20% in the last few months, to $1.30 per pound, and butchers won't throw in bones for free anymore.
Wei learned how to prepare the dish from his father, who was one of Ma Baozi's disciples. For the last 20 years, Wei has been running his nameless shop on Camel Lane in an old Hui neighborhood that evokes the city's past as a major stop on the ancient Silk Road.
In a small backroom, Wei's wife, Ma Bingxiu, pulled noodles in long strands, twirling and slapping them on a table before dropping them into a large coal-fired kettle. Wei says he mixes a special stone-shaped herb grown in the Gobi Desert into the flour, which he says enhances the elasticity and flavor of the noodles.
Wei makes the broth using 14 ingredients, including garlic, cinnamon, radish, nutmeg and, of course, beef. He adds a thin layer of beef fat on the surface of the soup to keep it hot.
Wei never raised his prices above the government ceiling, but says he understands why shop owners are ignoring the city's edict. Wei can still make a profit - about 7 cents a bowl - because he doesn't pay rent. But just about everything else is going up fast, he says.
"I think it's unnecessary for the government to limit or control the price," says Wei, wearing a white apron and a Muslim skullcap. "The most important thing is to control quality."
Noodle-shop owners have hardly been a vocal group, and few would dare call their resistance a protest. Nonetheless, emboldened by comments from scholars and editorials around the country, they have no plans to toe the government line.
"This is completely the action of a planned economy," said Yi Xianrong, a prominent economist at the Chinese Academy of Social Sciences. "Why don't they control house prices too?"
Local academics were more forgiving of the city's Bureau of Commodity Prices, saying that however flawed the policy, it meant well. Bureau officials declined to comment.
"I don't think it's a step backward," said He Wensheng, a public administration lecturer at Lanzhou University. "It's a good sign that government is concerned about ordinary people's lives."
What's more, he said, it's not just food that has raised consumer hackles. The cost of healthcare, housing and education are all going up too fast.
"For a lot of people, the rise in beef noodle was like the last straw," he said.
For Wang Xiaoming, 25, the commotion over beef noodles couldn't have come at a worse time. He and his three brothers opened their noodle shop just six months ago, after they were ordered to stop selling barbecued lamb on the streets. Local authorities said such vendors were polluting the city and were bad for its image. So the Wang brothers, with their parents, pooled their money and invested $6,500 to open a 35-seat shop in Xigu district.
When other shops around them were jacking up prices last month, the Wang brothers held back, fearing that the sudden hike would drive their patrons away. "It's not because of the new law. Our customers can't accept it," said Wang, the third of the brothers.
But neither could they make any money charging 33 cents a bowl. So the Wangs decided to stay open 24 hours, in the hope of making it up with volume.
At 3 a.m. Sunday, Wang shuffled between the kitchen in the back, pulling noodles, and the front counter, greeting customers. For the next hour, a steady flow of cab drivers pulled up. A handful of young people, out on the town, made their last stop for the night at Wang's. Migrant railroad workers warmed their stomachs before heading home for the wheat harvest.
Wang was on his way to serving another 400 bowls that day. His eyes were bloodshot.
"If prices keep rising, it's going to be hard," he said. "Even if we have a thousand customers, we won't make money."
Cao Jun in The Times' Shanghai bureau contributed to this report.