Middlemen to be focus of govt's fight against high prices
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Prime Minister Yingluck Shinawatra has ordered the Commerce Ministry to monitor middleman traders closely, believing excessive profit-seeking by this group is a main reason for the recent steep rise in the cost of living.
At a meeting at the ministry yesterday attended by the permanent secretaries of all ministries, Yingluck ordered the National Economic and Social Development Board (NESDB) and other agencies to brainstorm ways of tackling rising prices.
The prime minister ordered the NESDB to organise a workshop with the Energy, Industry, Agriculture, Transport, Commerce and other ministries to study the cost structure of goods from the upstream to the downstream sectors.
She said she expected solutions within one month.
At the meeting, officials repeatedly raised two issues: middlemen benefiting excessively from high prices, and producers’ cost structures.
After the meeting, Yingluck said she wanted the Commerce Ministry to curb the profit margins of middlemen, as the cost of raw materials and the prices of farm goods had not increased.
“The current retail prices do not reflect the real costs of production, as raw-materials costs have not increased. The ministry should urgently close the gap between prices at the farm gate and the retail prices paid by consumers,” she said.
The profit margins of wholesalers and modern traders will be monitored by the government, as it wants to ensure fair profit margins and curb retail prices, she said.
To ensure fair retail prices, Yingluck has instructed the Internal Trade Department to study the price structure and supply chains of essential goods and foods. In particular, 10 products including pork, chicken, eggs and cooked dishes will be studied.
Yingluck ordered the ministry to reduce market-dominant practices and create greater choice of trading channels for consumers.
She added that the government would only control the price of goods as a short-term measure. If the cost of production really increased, retail prices should reflect that via the market mechanism, she said.
Commerce Minister Boonsong Teriyaphirom said the ministry should complete the price-structure study within a few weeks so that it can take steps to control the profit margins of some middlemen.
He said the ministry had found big differences between farmers’ incomes and those of some middlemen. The government will focus on tackling the rising cost of essential goods and food products, Boonsong said.
To control middlemen’s profit margins, the government may need to enforce laws stringently to ensure fair practices for consumers, he said.
