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Published on February 23, 2008

The ministry met with 300 producers from nine sectors yesterday in a bid to decrease consumers' burdens and curb inflation.

Four priority sectors that agreed to hold off price rises are electronic appliances, Mama instant noodles, cleaning products including shampoo, soap and detergents, and seasoning products under the Pantainorasingh brand.

Pork prices and mobile-phone service fees will soon be reduced, said Commerce Minister Mingkwan Sang-suwan.

To solve the problem of high pork prices, the ministry is considering allowing pig imports from overseas.

"Most of the consumer-goods producers agreed to hold off price rises as long as possible this year, despite facing higher costs of production. The ministry will also try to convince other manufacturers to freeze their retail prices, with an agreement due to be reached before March 6," Mingkwan said.

However, manufacturers of vegetable oil and animal feed said it would be very difficult to freeze retail prices as production costs had surged significantly in the world market.

Mingkwan said the ministry would not allow any manufacturers to increase prices at the moment.

Instead, the ministry will help producers seeking measures to control costs of production without passing the burden to consumers.

Mingkwan also advised enterprises to increase their production so that they would benefit from economies of scale and decrease manufacturing costs.

He said the ministry would help enterprises to seek retail channels in neighbouring countries including Laos, Cambodia and Burma.

The ministry wants the 300 manufacturers to postpone price increases in a bid to keep annualised inflation at 3-3.5 per cent and alleviate the burden on consumers suffering from high oil prices.

Suthorn Wattanaporn, president of Pantainorasingh Manufacturers, said his company would freeze its retail prices for six months, despite higher costs of raw materials.

"However, the company may have to ask for price increases in six months' time as we are facing losses from skyrocketing oil prices and raw materials," he said.

A source from a palm-oil producer said the company would be unable to decrease or freeze prices for too long because it was making a loss from the current retail price.

Suvit Tantivetchvutthikul, president of the Fish Sauce Manufacturers of Thailand, said its members did not agree with the government's plan to force down retail prices.

Costs of fish sauce have jumped by 14 per cent this year. The sector has high competitiveness to control the market mechanism, he said.

A representative from the Federation of Thai Industries suggested the government seek other measures to bring down prices rather than forcing enterprises to decrease prices at a time of higher costs.

The source said the government should help to decrease the costs of packaging, logistics and tax.

Petchanet  Pratruangkrai

The Nation