Rice prices expected to remain stable

As imports offset production shortfall

MANILA, Philippines — Filipino consumers can heave a sigh of relief as rice prices are expected to remain stable, with imports under lower tariffs offsetting the reduction of nearly 500,000 metric tons (MT) in domestic palay harvest recorded in the first half.

The lower palay output would have a “minimal” impact on rice prices as the continued entry of imports at 15 percent tariff would offset the shortfall in local production, said Roehlano Briones, senior research fellow at the Philippine Institute of Development Studies, while noting that rice prices are expected to remain stable.

Philippine Chamber of Agriculture and Food Inc. president Danilo Fausto expressed the same sentiment, saying that the influx of imports would prevent any uptick in retail rice prices in the domestic market despite lower harvest in the first half.

“There should be no reason for rice prices to increase,” Fausto told The STAR.

The country’s palay production from January to June declined by 5.5 percent on an annual basis to a four-year low of 8.53 million MT due to lower farm yield as some farmers delayed planting amid threats brought about by the El Niño phenomenon. 

Palay output in the first half of 2023 stood at 9.026 million MT, based on Philippine Statistics Authority (PSA) data.

The latest output is the lowest first-half production recorded by the country since 2020 when production fell to 8.386 million MT.

PSA data indicated that both production of irrigated and rainfed palay during the six-month period contracted on an annual basis.

Government officials and industry stakeholders attributed the reduction in palay output to the ill effects of hotter and drier weather conditions caused by El Niño.

The erratic weather conditions forced farmers to delay their planting to avoid losses. Palay planted by farmers who survived El Niño suffered lower crop yield.

Some industry players noted that the decline in palay output translated to at least seven days’ worth of nationwide rice supply.

On the other hand, the country’s rice imports as of July 25 have reached 2.441 million MT, a fifth higher than the 2.02 million MT recorded volume in the same period last year, based on Bureau of Plant Industry data.

The retail price of locally produced well-milled rice in Metro Manila markets remained stable at P48 to P55 per kilogram while regular-milled rice ranged from P45 to P52 per kilo, based on the latest Department of Agriculture (DA) price monitoring report.

The DA report also showed that the retail price of imported well-milled rice ranged from P51 to P53 per kilogram while its regular-milled counterpart fetched between P47 and P48 per kilo.