DTI monitoring ‘shrinkflation’ in prime commodities

MANILA, Philippines — The Department of Trade and Industry (DTI) said it continues to monitor shrinkflation changes implemented by manufacturers, noting that these need to be evaluated if covered under the suggested retail price (SRP) bulletin for basic necessities and prime commodities (BNPCs).

In a radio interview with dzXL yesterday, Trade Assistant Secretary Amanda Nograles explained that shrinkflation happens when manufacturers change the weight or quality of the product while retaining its price.

She acknowledged that the moves of manufacturers to make changes in their products are a business decision that the agency cannot stop.

“But we are monitoring this because when they change the weight or the quality of the time, but the price is the same and that item is on the SRP bulletin for BNPCs, it comes out that it is a price adjustment,” she said in Filipino.

“So that needs to be evaluated by the DTI,” she said, adding that these manufacturers need to submit supporting documents to the DTI so that it can assess this.

Meanwhile, Nograles explained that it is illegal for manufacturers to make changes in weight of products that are not reflected in the label or packaging.

As an example, she cited that a product’s weight was lessened to 45 grams, however the 50 grams label on the packaging remained – this is misleading to consumers and is illegal even for products not under BNPCs.

Under Republic Act 7581 or the Price Act, as amended, the DTI is mandated to issue suggested retail price (SRP) bulletin for BNPCs under its jurisdiction for the information and guidance of manufacturers, distributors and consumers.

High rice prices

The high retail price of rice is expected to persist in 2024 amid the spike in the cost of the grains despite the end of harvest season, a ranking official of the Department of Agriculture (DA) admitted on Thursday.

In a radio interview, Agriculture Assistant Secretary and spokesperson Arnel de Mesa gave assurance of enough supply of rice with the expected arrival of 495,000 metric tons of imported staple food from Taiwan and India until February 2024.

“That is the hope of all our countrymen, for the retail price of rice to go down but let us see because we have continuous challenges like the El Niño phenomenon which can affect the areas planted with palay,” De Mesa said.

Despite the harvest season from October to November, the retail prices of the staple food have increased as based on monitoring of the DA, the retail price of local regular milled rice was sold as high as P52 per kilo; local well-milled rice, P56 per kilo; local premium rice, P62 per kilo; and local special rice, P68 per kilo. Imported well-milled rice was priced at P58 per kilo; imported premium rice, P61 per kilo; and imported special rice, P65 per kilo.

De Mesa added that the DA expects all the 495,000 metric tons of imported rice from Taiwan and India this month until next February.

“At least 1,000 metric tons of donated rice from Taiwan already arrived and at least 75,000 metric tons Indian rice already arrived and we expect that bulk will arrive from January to February in time for the lean months of mid-January until mid-February. This will be sufficient plus our local harvest until the next harvest season of March and April next year.

According to De Mesa, efforts are also being made to increase the yield particularly in Regions 6, 8 and 12 amid the low harvest despite many areas dedicated to planting palay. De Mesa said that the DA targets to increase palay production from 24 million metric tons to 25 million MT.

Federation of Free Farmers national manager Raul Montemayor said the expected arrival of 500,000 metric tons of imported rice is still not enough as the country needs 2.5 million to three million metric tons to prevent a possible rice crisis next year.

“That (500,000 MT) is good only until March. After that, if El Niño hits us hard and additional imports do not come in, we will have supply problems during the July to September lean months,” Montemayor told The STAR.

“It is still abnormal actually as the volume of imports decreases amid the high imported rice. In case, that will arrive, it is still not sufficient… They (DA) used the word ‘expects,’ it means, it is still not sure,” Montemayor said.

The harsh impact of El Niño on farm harvests may drive price increases in basic commodities but Congress has prepared for it by including an extra ayuda fund in the P5.7 trillion national budget, House Minority Leader and 4Ps Party-list Rep. Marcelino Libanan Jr. said on Wednesday.  – Bella Cariaso, Miriam Desacada, Delon Porcalla