Ministry to analyse firms’ production costs

Ministry to analyse firms’ production costs
Published: 02 May 2006

The Thai Internal Trade Department plans to use an economic production cost analysis system as its guide to assess manufacturers’ requests to increase retail prices.   In announcing the new approach yesterday, the department’s director-general, Siripol Yodmuangcharoen, also said the department would reject a request from Siam Cement Plc to increase the retail price of cement.  
 
Siripol said the analysis system would allow officials to closely monitor production costs from raw materials through to finished products, as well as weighing other factors, such as advertising, commissions and delivery.  

"We are closely monitoring production costs and prices of goods efficiently and accuracy, because the price of diesel has risen from Bt14 per litre to Bt26," Siripol said.   "According to production theory, the increased diesel price should have pushed production costs up by 10 per cent, but our report shows that the oil price crisis has not affected production costs by more than 2 or 3 per cent. As a result, there is no reason for increased retail prices."  
 
Siam Cement president Kan Trakulhoon said on Wednesday that the group would request approval for an increase in the price of cement as it has been affected by increasing energy costs. However, Siripol said the ministry had no policy for the retail price of any goods to increase. Moreover, the department has not received a request from Siam Cement to increase its prices.