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Published on October 16, 2007

Truck operators yesterday announced plans to raise freight rates from November 1, dealing a further blow to consumers who have already seen an increase in bus fares and face the prospect of price hikes of several goods due to upward movement in global oil prices.

New York crude yesterday hit a record high of US$85.19 (Bt2,910) per barrel amid concerns about more unrest in Iraq that could further stretch tight global energy supplies.

In Thailand, oil firm Shell is preparing to raise retail gasoline and diesel prices if world prices remain this high. Gasoline now costs $87.62 a barrel while diesel is at $93.03, further reducing retailers' margins.

Thongyoo Kongkun, secretary-general of the Transporta-tion Federation of Thailand (TFT), said the freight increase was unavoidable given the higher diesel price, but would initially be applied only to goods not for domestic consumption. The current freight rate is based on a diesel price of Bt22 per litre, whereas the actual price is now Bt27.34, he said.

He said the federation would postpone the hike if the Transport Ministry agreed to three proposals.

First, it wanted the ministerial regulation limiting the height of containers to 4.20 metres above the ground to be scrapped. It said the international standard height was 4.60 metres, while in many countries there was no such limit.

Second, the highways law must be amended to reduce the penalty for drivers of overloaded trucks to a fine, not a fine and imprisonment.

Third, the number of permanent weighing stations in the country should be increased from 40 to between 84 and 96.

"If these proposals are agreed to, it will provide greater convenience to our operators and we will postpone the hike," Thongyoo said.

Transport Minister Theera Haocharoen said he would consider the proposals.

Meanwhile, consumers will be more directly affected by the increase in the price of cooking gas by Bt2-3 per litre in mid December. Instant noodles, which are a staple for low-income earners, are also poised to go up by Bt1 per pack. Manufacturers of more than 100 consumer goods also plan to raise prices due to higher manufacturing costs, driven mainly by fuel costs and shortages of raw materials.

Private bus operators in Bangkok yesterday raised fares by 50 satang to Bt8.50. State operator Bangkok Mass Transit Authority has said it will raise fares on its buses only in January.

The increase in bus fares agitated some consumers, who filed a petition in the Administrative Court yesterday over the hike, saying it had been miscalculated.

Theera said the increase, which has been delayed for some time, was justifiable. "Despite the petition to the court, this presses no weight on the authorities' future consideration as there are standard criteria in this matter."

However, the ministry agreed to provide better protection to consumers by restructuring the Central Land Transport Committee - which makes the final decision on bus fares - to include consumer representatives.

Deputy Transport Minister Sansern Wongcha-um, while saying that agencies had been asked to check whether the price-adjustment factors were correct, said the representation for consumers would make future fare hikes more acceptable to the public.

Sansern said he had received a number of complaints from bus passengers that some fare collectors refused to give them 50 satang change and automatically charged passengers Bt9.

Transport Company, state-owned provider of inter-provincial bus services, has postponed hiking fares for three months while private operators have raised theirs, widening the price gap. For example, Transport Co charges Bt518 on the Bangkok-Chiang Mai route while private operators charge Bt559 - a difference of Bt41.

Business Reporters

The Nation