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                <p>BEIJING (Reuters) – China's economic agency told shoppers Thursday to stop panic buying salt, blaming baseless rumors that the iodine in it can stop radiation sickness.</p>
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The Chinese government has repeatedly said the country's residents will not be exposed to radiation from a nuclear plant in northeastern Japan which engineers are frantically trying to bring under control after it was damaged by last Friday's earthquake and tsunami.</p>
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But in a sign of increasing public worries about the risks, people across much of China have been buying large amounts of iodized salt, emptying markets of the usually cheap and plentiful product.</p>
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The National Development and Reform Commission (NDRC), the country's economic policy agency, said price regulators could investigate and punish price gouging.</p>
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"In recent days, some areas have been affected by rumors that have sparked intensive buying of salt, and some lawless merchants have leapt at the opportunity to raise prices," said the NDRC in an emailed statement.</p>
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"Don't believe rumors, don't spread rumors, and don't panic buy," said the notice.</p>
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The spike in demand may be born of a misunderstanding of reports noting that the thyroid gland is susceptible to radioactive iodine -- just one of several types of radiation that could be produced by the crippled reactors -- and that potassium iodide tablets can block the radioactive iodine if taken before exposure.</p>
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Salt containing iodine, however, would not shield against the radiation, medical experts said in newspaper reports on Thursday, adding there was no reason for alarm in China, which is thousands of kilometers away from the reactors.</p>
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Still, some Chinese residents formed long lines to buy salt, and the state distribution company has vowed to speed up supply.</p>
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At a Hua Pu Supermarket in Beijing, shoppers bought salt faster than the staff could stock shelves with it.</p>
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One woman carrying a package of salt was stopped and asked by others where she got it.</p>
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"This bag of salt was given to me by my friend who bought it this morning," said the woman, who declined to give her name. "I heard they queued for a long time, and each person was only allowed to buy five bags."</p>
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(Reporting by Zhou Xin and Chris Buckley and Sabrina Mao; Editing by Ken Wills and Daniel Magnowski)</p>
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            </p></div></div><p><strong>Read more:</strong> <a class="rssreadon" rel="external" title="Stop hoarding salt, China tells radiation-scared shoppers   (Reuters)" href="http://us.rd.yahoo.com/dailynews/rss/oddlyenough/*http%3A//news.yahoo.com/s/nm/20110317/od_nm/us_economy_salt" target="_blank">http://us.rd.yahoo.com/dailynews/rss/oddlyenough/*http%3A//news.yahoo.com/s/nm/20110317/od_nm/us_economy_salt</a></p>