Rising fertilizer prices will put additional pressure on consumers already reeling from a 17-year-high inflation rate, according to a study by the National Statistical Coordination Board (NSCB).

The study shows that the rise in fertilizer prices will increase agriculture production cost by 0.15 percent and jack up average prices of goods and services by 0.60 percent.

?Household expenditure will rise by 0.34 percent on top of normal inflation,? the study says.

?A family of five living in the National Capital Region [Metro Manila] with an average daily expenditure of P337 will need an extra P43 to cover the additional expenses for food and nonfood items given a normal inflation of 12.5 percent,? it says.

Inflation as measured by the increase in the consumer price index reached 12.5 percent in August, the highest since 1991.

Prices of fertilizer have gone up by between 38 and 80 percent this year, the study says. As fertilizer accounts for 30-40 percent of agricultural costs, production of rice and other crops will cost farmers about 0.15 percent more, it says.

From January to July, prices of urea rose 38.29 percent, N-P-K 77.82 percent, and ammonium phosphate 80.05 percent, the study says.

The study traces the increases in fertilizer prices partly to rising prices of natural gas, which is converted into ammonia that is used to make ammonium nitrate, a key fertilizer ingredient. The price of natural gas rose 53.6 percent in the second quarter.

?This may be one of the reasons why the price of ?palay? [unmilled rice] increased by 50.7 percent in the same period of 2008,? the NSCB study says. ?In fact, the average monthly retail price of one kilo of rice rose by 57.0 percent to P38.76 in July 2008 from P 24.69 last year.?

The study, using cost-price analysis, says that among the agricultural crops, rice will have the biggest increase in production cost at 0.06 percent, followed by banana at 0.02 percent. It says costs of sugar milling and refining will rise 0.01 percent, and canning and preserving of fruits and vegetables 0.005 percent.

The study says the agriculture, fishery and forestry as a sector will likely post a 1.49-percent increase in average prices, the industry sector 0.62 percent, and the services sector 0.08 percent.

Prices of milled rice and corn are expected to increase 0.12 percent and those of trade services 0.03 percent, it says. Amy R. Remo; edited by INQUIRER.net