Baconomics at play: Pork prices sizzle down, fuelling October’s inflation cool-off
A decline in pork prices significantly contributed to a reduction in the inflation rate in October, an anonymous figure within the Finance Ministry has revealed. The inflation experienced a year-on-year decrease of 0.31% in October, largely due to a 0.2% drop in energy prices, attributed to lower oil costs and employed subsidies to keep energy prices in check.
Moreover, food prices saw a decrease of 0.5% in October, with pork prices being a significant contributor. Despite a 0.2% price increase in ready-to-eat meals, there was a general decline in inflation during October.
This development comes as a relief to the ministry, as it alleviates some of the economic burden caused by the recent surge in global crude oil prices. A lower inflation rate is generally beneficial for the economy.
With regards to economic stability, public debt at the end of September accounted for 62.1% of GDP, comfortably below the 70% ceiling outlined in the fiscal discipline framework.
In terms of external stability, the situation is reported to be stable and capable of supporting risks stemming from global economic volatility. This is evidenced by the country’s international reserves at the end of October, totalling US$211 billion (7.3 trillion baht).
However, a second source within the ministry highlighted the significant issue of rampant pork smuggling, which poses a considerable threat to the domestic industry. The majority of smuggled pork originates from South American nations like Argentina and Brazil, where animal feed costs are lower than in Thailand, resulting in reduced production costs.
According to statistics from the Customs Department, numerous arrests have been made for illegal pig and pork product importation. In fiscal year 2021, 14 individuals were detained for illegally importing 236,000 kilogrammes of pig products. This figure increased in fiscal year 2022, with 25 individuals detained for smuggling 431,000 kilogrammes of pig products. So far this year, 18 people have been apprehended for illegally importing a staggering 4.77 million kilogrammes of pig products.
In related news, earlier in November, the abrupt transfer of Department of Special Investigation (DSI) director-general Police Major Suriya Singhakamol prompted an investigation by the House Committee on Agriculture and Cooperatives into pork smuggling. To learn more, read HERE!
