Fuel cost savings mean P3.46 rollback in basic goods – DTI

by Bernie Magkilat January 25, 2016
http://www.mb.com.ph/fuel-cost-savings-mean-p3-46-rollback-in-basic-goods-dti/

The Department of Trade and Industry (DTI) said that prices of basic goods and commodities should be rolled back by as much as P3.46 following steep decreases in fuel prices.

Based on its assessment, the DTI said insisted that significant drop in prices of petroleum products is already equivalent to 1.12 percent up to 1.66 percent or a reduction of as much as P3.46 percent in prices of basic and prime goods.

Initial list of manufactured goods identified by DTI for price rollback include condensed milk, coffee refill, powdered milk, instant noodles, canned sardines, corned beef, flour and cement.

The DTI assessment is based on the report by the Department of Energy that prices of diesel, which is most commonly used by manufacturers, have gone down by 37.8 percent while gasoline prices went down by 16.28 percent in 2015 alone.

There have been continuing reduction of oil prices by oil companies since January this year to reflect further reduction in prices of oil in the international markets. As of today, pump prices of diesel have gone down to as low as P19 per liter. Already, jeepney fares have been reduced since last week by P1.

In addition, the DTI also noted the report by the Confederation of Truckers Association of the Philippines (CTAP) that they have already reduced trucking rates last year.

For a 20-footer truck, CTAP said trucking rate has gone down by P1,-5- to P1,875 while the 40-footer truck rate was reduced by P1,245 to P2,040.

DTI Secretary Adrian S. Cristobal Jr. stressed that savings from petroleum prices should translate to rollback in prices.

At the National Price Coordinating Council meeting on Friday, Cristobal also acknowledged that the fuel prices are not the sole factor to consider in production. He said there are supply chain issues that affect cost of production.

CTAP Vice-President Pepito Dino said the worsening traffic congestion in Metro Manila now costs truckers one liter per one kilometer. It has also delayed their deliveries by one to 1.5 days. Dino also noted of slower demand for trucking services due to lower exports.

DTI said they will come up with a new computation together with the manufacturers in two weeks.