High Inflation & War Push Instant Noodle Makers To Demand Thailand's First Price Hike In 14 Years

Multiple instant noodle maker companies have requested the government of Thailand this week to allow them to charge more for their products in order to meet rising costs, potentially paving the way for the first price hike in the staple for 14 years.

The prices of instant noodles and other staples are controlled under Thai law. Five producers of noodle brands including Wai Wai, Mama and Japan's Nisshin said they were seeking approval from the Commerce Ministry to increase prices of their products from 6 baht ($0.17) to 8 baht ($0.23), as per Reuters report.

Despite requesting, some companies had previously been denied an increase in prices by the government.

The government of Thailand will reportedly consider proposals on a case-by-case basis and any solution would have to be a win-win for both consumers and producers, Thailand's Director-General of Internal Trade Wattanasak Sur-iam said in a statement.

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Factors Affecting Instant Noodles¡¯ Prices

Five major producers of instant noodles have requested for price hikes, warning of soaring production costs affecting one of the country¡¯s most popular grocery items.

The war in Ukraine, as well as droughts and floods over the past year, have caused the cost of wheat, energy and transport costs to rise sharply, affecting noodle prices across Asia, as per The Guardian report.

In Thailand, where inflation rate reached 7.61% in July, down slightly from a 14-year high the previous month (June), the Thai government imposes price controls on certain essential goods in an effort to relieve pressure on consumers. Price caps are placed on items such as eggs, cooking oil as well as noodles, which are favored by many as a cheap and convenient meal, the report mentioned.

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Sharing views on the situation, Weera Napapruekchat, Vice President of Thai Food Products Factory, which makes Wai Wai, said "The price of oil has increased considerably due to Russia-Ukraine conflict,", adding that the price of wheat flour and palm oil have also risen sharply.

Further, Weera said that some of its products were being sold at a loss and that it would reduce sales in Thailand and switch to overseas markets, where it has already increased prices, if approval is not granted.

Also Read: Maggi Maker Nestle Warns Of Further Price Hikes In Coming Months

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