Inflation tsunami : price of sugar to rise by 37 % !

Week after week, the events confirm my theory of “inflation tsunami“.

Consider this last striking news :

Retail sugar prices will soon rise by as much as 37% following the cabinet’s decision yesterday to approve an increase of five baht a kilogramme in the ex-factory price of the commodity.

The price increase was proposed by the Office of the Cane and Sugar Board (OCSB) in a bid to meet rising costs of cane production and cover a promised increase in cane prices to 807 baht a tonne for farmers.

The retail price with VAT will jump from 17.25 baht to about 23.60 baht per kilogramme, which is still almost 35% less than what consumers in many other countries pay. (Bangkok Post)

That’s indeed a hike of 37 % ! And it’s important to note… that even after this hike… we are still behind other countries… It means : further increases could be possible…

Prakit Pradipasen, chairman of the Thai Sugar Millers Corporation Limited, said the increase was very dramatic.

”The cabinet decision is a shock to me, though I have no problem with it as farmers will have more income,” he said. ”But the move will definitely reduce domestic sugar consumption and indirect effects will be seen through higher production costs among food and soft-drink producers.”

That’s really interesting : the guy who is supposed to defend the interests of his corporation… complains !

And to finish, the last straw if I may say, that confirms my theory :

Prangnee Chaipidej, advertising and PR manager of Serm Suk Plc, the local bottler of Pepsi, Mirinda and 7-Up, said the company would be severely hurt by the 30% rise in sugar prices as it was one of main ingredients in carbonated drinks.

”The sugar price rise will cause more trouble for us since we were dealing with the impact from oil prices, which have been surging for months. Moreover, labour wages are likely to increase as well,” she said.

The price of soft drinks… will increase. That’s a certainty. The thai government can bark, cry, ask the companies to postpone, or whatever… the prices of all the soft drinks will increase in Thailand. Soon.

And that will put more pressure on thai consummers… Who will ask for higher wages… And all this will fuel… the inflation rate.

This is the inflation tsunami on the move.

Live and direct.

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Thailand Crisis

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