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Tuesday, June 07, 2005
Hike in power rate ups prices of basic goods
By Jenny Molbog-Mendoza
THE Department of Trade and Industry (DTI) projected that with the approved increase in power rates, production costs are also expected to rise triggerring an increase in the prices of basic commodities.
Based on the report transmitted by the National Price Coordinating Council (NPCC) to DTI-11, the Manila Electric Company (Meralco) started to implement a power rate increase on May 26. With this, all companies that are connected to Meralco have increased the prices of their products as well.
"And since most of the manufacturers of various goods are based in Manila, this would create an impact to the entire consumers," the report added.
The cement manufacturers, for instance, are anticipating for an additional P2 per kilowatt-hour increase in their power consumption because of the power rate hike imposed by Meralco.
DTI-Davao City Field Office director Teolulo Pasawa said last week that since power comprises more than 50 percent of the total production cost of cement, any upward movement of power cost would increase the prices of the said product.
Earlier reports showed that cement manufacturers have already raised their prices from P153 to P155 for the last three months.
The same report of the NPCC likewise revealed that coffee bean, a major component in the production of coffee, posted a P20 price increase. This caused the rise of coffee prices in the market.
Nonetheless, the report added, Nestle, one of the major coffee manufacturers in the country, committed that it would try to hold off any price increase of its Nescafe products barring any escalation in its production costs.
Coffee prices have been in the upward trend for all the brands. Price changes range from P0.50 to P1," the report said.
The NPCC report said the milk and instant noodles manufacturers such as Alaska and Nestle also extended their support to the Council by holding price increases as long as there are no major adjustments in their costs of production.
For Bisaya stories from Davao. Click here. (June 7, 2005 issue)
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