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Published on March 11, 2008

The announcement marks another misdirected Commerce Ministry policy because it's unlikely to have a real impact on the market. First of all, the announcement simply prompted retailers to adjust their marked prices to give the psychological impression that prices were cut even though they were not. Normally, retailers report higher prices to the ministry than what they actually sell their products for anyway.

Pork prices naturally rose in line with the cyclical trend of the world market. The prices of oil and animal feed have risen lately, but the trend is cyclical. If the prices go up too high, supply and demand would adjust to a balanced level.

Mingkwan should instead think of an effective strategy to help producers turn out products at competitive prices by looking at the entire chain of raw materials used in production. The minister should put more effort into policies that really have long-term benefits such as helping producers better manage their costs of production by, for instance, adjusting the trade rules and regulations to enable Thai producers to use competitively priced imported raw materials. Nonetheless, one month has passed but Mingkwan has yet to spell out any effective measures. Instead, he has wasted his energy by deciding on a short-term oriented policy, backed by political pressure. The price-cut policy is short-term oriented and will be ineffective, as it does not reflect the actual prices on the market. Mingkwan should listen to the wisdom offered by Prime Minister Samak Sundaravej on Saturday who said, "If the pork is expensive, let's eat chicken".

The Nation