Rising Prices

[Greenside]

A couple of weeks back I mentioned that UNIP had raised its food prices and this morning I found that my favourite breakfast joint, Sailomjoy at Thapae Gate, had joined them with a 20% hike on their cheapest set. Of course you don't expect to see prices go down anywhere outside of the electronics and computer businesses but I thought it might be interesting to gather price change info in a thread so as to come up with a feel for what's going on, at least in CM. After all, one of the real advantages of living here has been the low cost of eating out and although I haven't been here long enough to understand the medium term trends, I do know that it won't take many 20% a year hikes to erode that particular attraction given a fairly conservatively increasing pension income.

Also of interest: what's expensive here and what's not (compared with your home country)? So just to kick that off:

Fruit Juice: TH 60 - 70 bht per litre; UK 45 - 50 bht

Wine: (Drinkable!) 500 bht up; UK 300 bht up

[Ulysses G.]

Sailomjoy at Thapae Gate is so cheap that I'm not sure it is an indication of normal pricing. I buy food there all of time - including today - and none of the things that I eat have gone up.

[samtam]

I don't know what the official rate of inflation is, but I agree that the general cost of living seems to be increasing rapidly, judging by the purely unscientific weekly grocery bills I pay at Tops Supermarket, and also doctor's fees at the (BNH) hospital. If the new government gets its act together there will presumably be an acceleration of this phenomenon, as they intend to make big spending projects a priority, to get the economy rolling again. Ditto the prices being asked for property and rents, (whether achieved or not).

Edited December 30, 2007 by samtam

[ollylama]

I've also noticed remarkable hikes in prices everywhere lately. The burger at the irish went up from 80 to 110 baht - almost 40%! smoothie blues on nimmanhaemin seems to jack up their prices every few months. And what happened to american breakfast sets for under 100 baht? they used to be everywhere.

in my experience it's mainly the tourist places that seem to be raising their prices much faster than normal inflationary dictates would mandate. i guess it's just that the type of foreigner who visits here now can afford to pay more and it's only natural that prices will keep up with what people are willing to shell out. a few years ago it was easy to find a passable guest house room for 150 baht. now even the low end of the scale starts at 300-400. yet rents and market products haven't gone up commensurately (7-11 has hardly touched their prices in ages). the only thing that's really gone through the roof is petrol, and that doesn't justify these sharp hikes.

alas, chiang mai is no longer cheap as chips, peaceful as pie, nor anyone's well-kept secret. i was out in chiang rai a few weeks ago and places in the backpacker area there (the street by wat jed yot) seem to have raised their prices dramatically as well.

interestingly, i was just down on ko phangan last week and there are still decent beachfront bungalows available in some areas for 200 baht,with attached bathroom! in high season, no less. that was a surprise.

speaking of petrol: how long ago was it that song taews were 5 baht a ride? last year it was 15, now it's 20, probably will be 25 soon. i fail to see how local thais making 175 baht a day afford to get around that way. let's bring back the grizzled old bicycle rickshaw guys with calves of steel!

[Ulysses G.]

Maybe it's the old Thai tradition of raising prices when not selling well. Most people seem to agree that this isn't exactly a remarkable high season.

[siamshot]

At first really not a good season up to now, at second a lot of suppliers also raised their prices - and at third I still pay 15 Baht with song taews up to three days ago.

Happy New Year!

[cmsoulbrother]

A lot of the basic things we buy at the restaurant have risen in price substantially over the last 6 months, more than a normal inflationary rise. Flour, Cheese, milk, meat, cooking oil etc...some of these are up almost 25% over a year ago. I'm no economist, but I think it has something to do with the increasing use of food crops for biofuel, thus bumping the price up on other food commodities, which then moves on down the line to pretty much all food.

I could be wrong here on the fuel thing, but I have seen a pretty dramatic (unusual) jump in my food supplies bills, and I certainly understand why restaurants around town might be raising, or thinking about raising, prices.

[PeaceBlondie]

The bacon cheesburger set at Mike's on Neimanheiman is still 135 baht, I still pay 10 baht to use the pool with a membership (okay, so I haven't gone for two months), fuel of course has skyrocketed, a bag of popcorn at Lotus is still ten baht, etc. But the partner who does most of the shopping says that food costs are much higher. Oh, and D-K sells EFL books for about 11% higher now, but maybe that's the first price hike in two years.

[ollylama]

The bacon cheesburger set at Mike's on Neimanheiman is still 135 baht, I still pay 10 baht to use the pool with a membership (okay, so I haven't gone for two months), fuel of course has skyrocketed, a bag of popcorn at Lotus is still ten baht, etc. But the partner who does most of the shopping says that food costs are much higher. Oh, and D-K sells EFL books for about 11% higher now, but maybe that's the first price hike in two years.

what pool is 10 baht with membership?

[Priceless]

I think that UG is hitting on a very valid point, which has also baffled me over the years. It appears that the Thai reaction to decreasing sales volumes is raising the prices, in an attempt to keep revenue/profit constant. This is in defiance of the laws of supply and demand that I learnt at university, but TIT after all

In the neighbouring moo baan they built six new houses a couple of years ago and priced them at about 12 million. Since they have only managed to sell two of them, they recently raised the asking price for the remaining ones by ½ million. I guess the idea was to cover financing and maintenance for the time they've been standing empty

/ Priceless

[PeaceBlondie]

The bacon cheesburger set at Mike's on Neimanheiman is still 135 baht, I still pay 10 baht to use the pool with a membership (okay, so I haven't gone for two months), fuel of course has skyrocketed, a bag of popcorn at Lotus is still ten baht, etc. But the partner who does most of the shopping says that food costs are much higher. Oh, and D-K sells EFL books for about 11% higher now, but maybe that's the first price hike in two years.

what pool is 10 baht with membership?

Pong Pote pool, north of Chiang Mai Ram I hospital, on a little soi. 200 baht annual membership, ten baht per day if you go. Open every day except big holidays, from about 10 am to 6 pm. PM me if you need precise directions.

[BlackArtemis]

I noticed some places are keeping the prices the same, but the protions have decreased.

it seems (to me) that Mikes have become smaller burgers.

Bullissimo's (spelling?) Had porkchops for 95B, two big ones, now it seems to be one thin one for the same price. But the food is still good so I will accept it for now, but keep an eye out.

Oh, one more thing... Most of the muu katahs have increased 20-40b over the last year...

[chiang mai]

The higher cost of fuel is one part of the picture, farmers growing crops for ethanol instead of putting the crop into the food chain is another part (sweetcorn is a prime example of this). Read somewhere last week that UK food prices are forecast to increase by 30% in 2008. As for the cost of living: inflation for a Thai is one thing but inflation for a farang is something very different and will vary based on lifestyle and tastes.

[sceadugenga]

Reading the Australian newspapers online indicates a pretty steady over the board price increase there.

Veg like potatoes, greens, sweetcorn, tomatoes and onions are a lot cheaper here and eggs and most fruits are if you want to use the village markets.

Pork, chicken, beef and fish are cheap and beer is cheaper if you avoid stuff like Heineken.

Cooked and processed foods like burgers are based on wages so as inflation increases so will these items.

Increasing fuel prices have to be taken into consideration with imported goods.

Clothes and shoes are cheaper if you don't happen to be Farang XXXOS.

Second hand books remain fairly stable though.

Edited December 30, 2007 by sceadugenga

[Ulysses G.]

beer is cheaper if you avoid stuff like Heineken.

I only like Heineken and Beer Lao!

[sceadugenga]

beer is cheaper if you avoid stuff like Heineken.

I only like Heineken and Beer Lao!

After the fourth or fifth it all tastes the same General.

[chiang mai]

beer is cheaper if you avoid stuff like Heineken.

I only like Heineken and Beer Lao!

I was just reading through a British newspaper and note from an advertisement that beer in one UK supermarket (lidl) sells as follows:

Budweiser, 300 ml, 33 baht a can, pack of 15

Stella, 250 ml, 23 baht a can, pack of 20

The above based on 66 baht per Pound.

Seems pretty cheap given that beer costs what it does here - and they say the UK is expensive.

[sceadugenga]

beer is cheaper if you avoid stuff like Heineken.

I only like Heineken and Beer Lao!

I was just reading through a British newspaper and note from an advertisement that beer in one UK supermarket (lidl) sells as follows:

Budweiser, 300 ml, 33 baht a can, pack of 15

Stella, 250 ml, 23 baht a can, pack of 20

The above based on 66 baht per Pound.

Seems pretty cheap given that beer costs what it does here - and they say the UK is expensive.

37B for a large Leo... 700ml? knocks those prices about a bit. Stella and Bud have to be seriously over rated beers any way.

[chiang mai]

beer is cheaper if you avoid stuff like Heineken.

I only like Heineken and Beer Lao!

I was just reading through a British newspaper and note from an advertisement that beer in one UK supermarket (lidl) sells as follows:

Budweiser, 300 ml, 33 baht a can, pack of 15

Stella, 250 ml, 23 baht a can, pack of 20

The above based on 66 baht per Pound.

Seems pretty cheap given that beer costs what it does here - and they say the UK is expensive.

37B for a large Leo... 700ml? knocks those prices about a bit. Stella and Bud have to be seriously over rated beers any way.

I'm not a beer drinker but are we comparing apples and apples ..... Don't go there people!

[chownah]

When we grew our first rice crop four years ago there were farm laborers who worked for 110 baht per day and this year everyone expected 180 baht per day!!!!

Chownah

[Ulysses G.]

Second hand books remain fairly stable though.

Actually, in Chiang Mai, second hand books have gotten cheaper and cheaper over time.

Compared to 15 years ago, the quality has risen remarkably - it was very difficult to get anything beside John Grisham and Patricia Cornwell type books back then - and the prices for beach type reading in baht is almost the same as it was in 1992 even though a dollar was worth 25 baht back then.

Nowadays, the better shops are overflowing with great paperback history, philosophy, psychology, Buddhism and other serious tomes that were almost impossible to get in the past.

Because there were so many shops at one time, the owners have kept trying to undercut each other and prices have dropped steadily over the years. Of course, the trendiest, hardest to get books are still quite expensive, but not like a few years ago.

Something like five used bookshops have closed for business in the last year or so, and others have been making little to no profit for quite a while and are only open because their owners subsidize them with their pension money.

My guess is that even more of them will fold soon after another lackluster high season and take a lot of second rate bars and restaurants with them.

Edited December 30, 2007 by Ulysses G.

[adjan jb]

Butter (227 gr.): 37 bahts 2 weeks ago, now 47 b.

Cooking oil: under 30 b a bottle a few weeks ago, now over 40 b.

(in all the supermarkets)

[mcgriffith]

Bangkok Post had a year-end insert in their Friday edition- 2007 financial review.

About 45 pages crammed with statistics that only a hedge fund manager or a economics professor would appreciate.

Of course, I read the entire thing, twice.

Inflation for the 10 months of 2007 that were available when this went to press was about 2.2 %.

Although hamburgers in tourist venues might have gone up 40%, the reality is that overall, things are not going up that much.

I will admit that earlier in the year my fav soi veggie lady was selling limes for 5 THB for 3. Due to a seasonal shortage, the price went to 10 THB for 3. I also thought at that point- "here we go, 15 THB is coming...". Nope. Supply came back, price down to 5 THB for 3 again.

Orchid brand unsalted butter was about 52 THB at Tops beginning of the year- now about 59 THB.

Rice, petrol, sugar and other items that have gov't subsidies (and price controls) have barely gone up at all compared to other countries in the last year. Example: Gas in the US went from about $2.19 to over $3.00 in the last year (price is down now from that peak). Yes, petrol in Thailand has increased pricewise- from about 26THB to 31 THB, for 91.

I wouldn't start hoarding food, gold coin and weapons, and head for the hills, just yet.....

[Ulysses G.]

Has anyone taken into account that many fruits and vegetables go up and down in price according to the season?

Mangos, durian, avocado, oranges, carrots and others are ALWAYS expensive at certain times of year and cheap at others.

[Greenside]

.

I wouldn't start hoarding food, gold coin and weapons, and head for the hills, just yet.....

While I wasn't about to make a run for the hills (which ones would be best, I wonder?) it does seem to me that for many of the above reasons we'll see the labour rates rising which will affect those things that really are cheap here. The grocery bills that seem to get bigger each month must have proportionally more of an impact on all the Thai shoppers I see in Carrefour and Tesco and that's bound to feed through eventually.

Big ticket items like houses and some appliances etc are still amazingly cheap but I don't think on balance the day to day stuff is that much cheaper than the UK (even with its viscious 17.5% VAT rate) and will get significantly more expensive relatively soon, whatever the Post's figures indicate.

As for putting up prices in the face of slow sales, why do they do that? Did it ever work for anyone, except maybe Gucci?

My (very smart) apartment building has been less than 25% occupied since it was completed in January and they flatly refuse to compromise on the rates when prospective tenants show up at the door. In a master stroke of sales psychology the boss just spent about 100k on four huge china vases to stand in the lobby (which is about 2 rai and furnished with dozens of tables and chairs that no-one has ever used) and placed an old upright piano next to the big plasma TV that only the night staff (when we had any) used. They also put some fitness gear in a small room but decided to charge tenants 200 bht a month despite the pretty high rents in place. I look forward to a 2008 socialising with all the new tenants this will undoubtedly attract.

Happy New Year!

[Ulysses G.]

As for putting up prices in the face of slow sales, why do they do that? Did it ever work for anyone, except maybe Gucci?

TIT! (This is Thailand)

Edited December 30, 2007 by Ulysses G.

[tijnebijn]

I hear many Thais also complaining .

A good reason , perhaps , why in the tourist areas (mostly)

the prices are going up so much is because the landlords of

all those properties are asking more and more rent for the place .

A couple of years ago , lets say around Tapae you could rent a place

for 5 - 8k the month , now in all the city there are not to many places to

find in such range( only bad selling areas) , so making profit gets harder and harder too !

Also a fact that many landlords nowadays are asking from the renter to pay their

taxes too or and some yearly bonus (petchia) .

Another thing what is worrying why there are so few tourists the last couple of years ,

pollution and lack of care of buildings and services is a big factor I think , the city gets

dirtier every year and nothing is done about it .....I do know some reasons , which has to

do with corruption but I will leave it there ....

[Ulysses G.]

I hear many Thais also complaining .

A good reason , perhaps , why in the tourist areas (mostly)

the prices are going up so much is because the landlords of

all those properties are asking more and more rent for the place .

A couple of years ago , lets say around Tapae you could rent a place

for 5 - 8k the month , now in all the city there are not to many places to

find in such range( only bad selling areas) , so making profit gets harder and harder too !

Also a fact that many landlords nowadays are asking from the renter to pay their

taxes too or and some yearly bonus (petchia) .

Another thing what is worrying why there are so few tourists the last couple of years ,

pollution and lack of care of buildings and services is a big factor I think , the city gets

dirtier every year and nothing is done about it .....I do know some reasons , which has to

do with corruption but I will leave it there ....

All true. Try renting a reasonably priced shop near Thapae Gate.

However, a lot of blame also goes to idiot farangs who keep paying higher and higher rents when they have no idea at all about the businesses that they are getting into. On top of that, they have usually just copied someone else in businesses that have no more room for growth. How many more British pubs or internet shops do we need?

99% of them fail, but there is always some new fool and his tiloc waiting to take their place. You almost can't blame the old Chinese landlords for taking advantage of suckers like this!

Edited December 30, 2007 by Ulysses G.

[tijnebijn]

The thing about copying another's business is also very

common with Thais , lets say beauty salons or bars even .

The crazy thing is the more businesses there are of the same

content the less money every business will make .

The amount of customers stays the same , so the ones giving

the best quality and services will be the victor in the end , its

just very tired some with people whom not have any good ideas themselves ....

Sure ya know what I mean ....

[Ulysses G.]

The amount of customers stays the same , so the ones giving

the best quality and services will be the victor in the end , its

just very tired some with people whom not have any good ideas themselves ....

Sure ya know what I mean ....

Of course you are right, but things are a little different here. If we were in London, only a succesful business could afford to pay the rent and the bad ones fail. In Thailand, there is a new sucker with his life savings coming over every minute and the rents seem quite inexpensive to them. By the time that they have lost every penny, there is new one just waiting in line to buy a bar for his honey!