Thursday, February 15, 2007
Driving Down the Price of Romance
Why is it that our government is always grabbing the headlines with silly policies? Have all the economists worth their salt left Thailand's public sector? How else do we explain our policymakers' apparent unfamiliarity with the laws of supply and demand? And as always, it is the poor farmers who suffer the consequences of these well-intentioned but ignorant policies.
A rose at any other price does not smell as sweet to growers
Bangkok Post, 14 February 2007
Tak _ Rose growers in Tak's Phop Phra district complain the Internal Trade Department's price controls on roses have dashed their once-a-year chance of turning a big profit _ Valentine's Day sales. The domestic supply of roses, particularly red ones, is outstripped by the huge Valentine's Day demand, and retail prices soar.
Phop Phra district is the largest producer of cut roses in the North, with planting over an area of more than 4,600 rai.
About 1.2 million cut flowers are produced daily. Of these, about 300,000 are top-grade roses.
The department has warned traders they will face tough legal action if they are found selling roses at inflated prices today. Director-general Siripol Yodmuangcharoen said rose traders had been told to attach clear price tags.
Top-grade roses should be sold at six to seven baht each, while average quality roses with shorter stems should be retailed at three to four baht apiece.
The department also instructed its provincial offices to survey the prices of roses sold at each local garden. The information will be used as a yardstick by which the prices of roses sold in Bangkok will be judged, to protect consumers from unscrupulous traders.
Mr Siripol said large-scale traders who collude to fix wholesale prices of the roses were liable to a maximum three-year jail term and a six million baht fine.
Small traders selling overpriced roses face up to seven years in jail and/or a fine of up to 140,000 baht, if caught.
Malai Toliang, head of a group of rose growers in Phop Phra district, said the department contacted him and asked how much growers charge for their roses. The department then proceeded to put curbs on rose prices, particularly in Bangkok.
''Rose growers are upset with the rose price controls. Sales are down. Retailers dare not make bulk orders out of fear they won't be able to set high prices,'' Mr Malai said.
Wikran Saengmanee, the district's agricultural promotion officer, said some growers might be forced out of business because of the price curbs.