Food prices under watch

Food prices under watch

Efforts set to prevent post-flood profiteering

Despite the upturn in weather conditions, prices for finished food have yet to be adjusted down. Food outlets and vendors have high hidden costs such as rental fees and labour, says the Internal Trade Department. Patipat Janthong
Despite the upturn in weather conditions, prices for finished food have yet to be adjusted down. Food outlets and vendors have high hidden costs such as rental fees and labour, says the Internal Trade Department. Patipat Janthong

The government has pledged to closely monitor both the prices and the adequacy of products for consumers, especially in areas hit by flooding.

But officials insist that there is not yet a need to call a meeting with companies to discuss or ask for cooperation in capping product prices.

Nuntawan Sakuntanaga, director-general of the Internal Trade Department, said the authorities have been assigned to watch food and product prices, particularly in flooded areas, to prevent profiteering by traders and ensure their adequacy for consumption.

The department will also monitor such items as sandbags and feed pumps that are widely used during periods of flooding. These and other items have been added to the list of sensitive products that require daily price movement monitoring.

Palm cooking oil, whose raw material price remains volatile, is also on the sensitive list, she said.

"The prices of fresh food, meat and vegetables starts falling after decent weather boosts production, although the prices for finished foods have yet to be adjusted down, as food outlets and vendors still maintain relatively high hidden costs such as rental fees and labour costs," said Mrs Nuntawan. "But the Commerce Ministry pledges to look into the issue and increase food choices to consumers by expanding the low-cost food scheme, which sells finished foods at prices no higher than 35 baht a dish nationwide."

Meanwhile, she said the government expects the trial process to get much faster once the new draft Trade Competition Act comes into force next year.

The cabinet approved on Tuesday several draft amendments to the Trade Competition Act, aiming to prevent unfair trade practices, ensure fair competition and attract more investment to Thailand.

The draft's salient points are adjusting the degree of penalties to match the gravity of the unfair practices, setting up an independent regulatory body to oversee trade competition and covering state enterprises that run businesses that compete with the private sector.

The draft also allows the new regulatory body to take legal action against those who are found to be running a business in violation of fair trade practices, with fines of not less than 10% of revenue for the previous year.

Cartels could also face criminal penalties if they are found to be operating in a manner which is seriously affecting other players.

The amendments also redefine the term "market domination" to cover businesses run by subsidiaries under the same group, both vertically and horizontally.

Competition conditions also need to take into account factors such as market structure, which includes the number of players, positioning, concentration and obstacles to access, access to manufacturing bases and distribution channels, natural resources and infrastructure, investment and networking.

The current act defines market domination as having at least 50% of market share in the previous year and annual sales of at least 1 billion baht.

Since the act came into force in 1999, 85 cases have been filed with the Office of Thai Trade Competition Commission for vetting, although none have resulted in a ruling.

Mrs Nuntawan said the draft is expected to receive endorsement from the National Legislative Assembly early next year, with the regulatory body and office being set up no more than 90 days thereafter. It is set to officially come in force by the middle of next year, she said.

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