Prices drop for construction supplies

Economy January 20, 2015 01:00


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FOLLOWING the collapse of fuel costs, the retail prices of building and other basic materials will be reduced in stages by 2-7.7 per cent to ensure fairness to consumers, according to the Internal Trade Department.

The first priority is five products – lubricant oil by 2-5 per cent, plastic pellets by 3.85-7.7 per cent, cement by 2-4 per cent or Bt2-Bt4 per 50-kilogram sack, roof tiles by 5-7 per cent or Bt3-Bt4 per piece and steel by 5-10 per cent or Bt1, 000-Bt1,500 per tonne.
Boonyarit Kalayanamit, director-general of the department, said yesterday that some products that rely heavily on transportation as well as petrochemical by-products are first in line to cut retail prices because the effect of low oil prices on their cost of production is clear.
However, it might not be able to adjust the retail prices of some products at all or maybe by just a notch because they depend less on diesel and have benefited only a little from the lower diesel price.
The cost to make each product varies, while each product will be impacted differently from the sliding diesel oil price.
A Bt4.50-per-litre chop in the diesel price will bring down the cost of goods by 0.01-1.04 per cent on average. Products that are heavy will benefit the most from softening transport costs, while the cost of production for consumer goods such as shampoo, soap and detergent will go down by only 0.06-0.13 per cent.
The prices of agricultural products may not be able to be changed much. For example, pork will only see a price cut of 0.08 per cent, eggs of 0.14 per cent and chicken of 0.17 per cent.
The department will continue to discuss with manufacturers and retailers about revising down some of their prices if it finds that their cost of production has dropped due to lower fuel prices.
Initially, consumers will see only the prices of heavy and petrochemical by-products coming down, but the prices of other goods should also decrease in the future as long as oil prices continue to be low.
Other products that will see price decreases are chemical fertilisers to the tune of Bt10-Bt30 per 50kg sack, and consumer goods, especially essential goods.
The department will next week announce its recommended price for cooking gas of Bt395 per 15kg tank for delivery up to five kilometres.
As a measure to protect consumers from unfair quotes, the department will dispatch teams of officials every week to the field to inspect prices and tags.It will also set up community markets in some areas to sell cheap products for consumers as part of the government’s plans to help ease the cost of living.