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Published on January 7, 2008

Its Trade and Economic Index Bureau director Nateetip Tongkoa-on said recently that the inclusion of the alternative fuels reflected reality, because both were widely used.

They will be used in inflation

calculations immediately. Skyrocketing oil prices will cause inflation worries this year, but these could be offset by the stronger baht, Nateetip said.

Biodisel and gasohol should affect inflation calculations by less than 1 per cent. The ministry projects the country will log inflation at 3-4 per cent in 2008. Last year inflation was 2.3 per cent year on year.

At present the ministry includes 373 goods and services in its inflation calculation.

The government allowed the price of cooking gas to float last year. The ministry said it had minimal effect on inflation. Cooking-gas prices rose Bt15 per 15-kilogram tank, with an attendant increase in inflation of 0.02 per cent.

The ministry will consider allowing four more products to increase their retail prices this year to compensate for rising costs of raw materials brought on by more expensive crude oil. They are car batteries, fertilisers, vegetable oils and dairy products.

The ministry last year allowed a Bt5.50 increase in the price per bottle of palm oil. It will allow another increase this year.

The ministry's Internal Trade Department director-general Yangyong Phuangrach said it would meet dairy and automobile-battery manufacturers on Friday to consider price-rise requests.

These products have reached their current price ceilings but are facing raw-material cost hikes.

"These products face significant cost increases. The ministry will consider allowing retail prices to increase," Yangyong said. Revised prices will increase in increments to cushion the effect on consumers.

Petchanet Pratruangkrai

The Nation