Global price pressures threaten Philippine inflation downtrend
MANILA -Upward pressure on food prices in the Philippines is mounting as global prices of staples, including rice, increased in April for the first time in a year.
This happened even before the expected return this year of El Niño, which brings less than usual rainfall or even drought, threatening crops—especially rice—and other farm output.
According to the Food and Agriculture Organization (FAO) of the United Nations, the global benchmark on food prices rose last month as higher international quotations for sugar, meat and rice outweighed declines in prices of wheat, maize or corn, dairy products and vegetable oils.
https://business.inquirer.net/399465/world-food-prices-rise-for-first-time-in-a-year-fao
The FAO Food Price Index saw 12 consecutive months of decline since reaching a peak in March 2022.
In April sugar prices rose due to expectations of reduced output amid dry weather conditions in major producing countries including India, China and Thailand.
Article continues after this advertisementAlso, prices of meat increased—especially pork and chicken—amid rising Asian import demand and production curbs spurred by animal health issues.
Article continues after this advertisementAnd while prices of wheat and corn decreased, international prices of rice continued to increase against a backdrop of reduced harvests caused by higher input costs and adverse weather, especially outside of Asia, sales to Asian buyers.
“It is important that we continue to track very closely the evolution of prices and the reasons for increases in prices,” FAO chief economist Maximo Torero said in a statement.
“As economies recover from significant slowdowns, demand will increase, exerting upward pressure on food prices,” Torero said. “At the same time, the increase in rice prices is extremely worrisome.”
Meanwhile, Secretary Arsenio Balisacan of the National Economic and Development Authority downplayed concerns of upward pressure on prices amid a looming threat of El Niño.
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“Agriculture’s performance this quarter—primarily due to favorable weather conditions—is a promising beginning to 2023, especially given the expected challenge of El Niño later in the year,” Balisacan said.
“We have experienced El Niño before and are confident that with adequate planning and preparation, we can successfully navigate it again this year,” he added.
Balisacan said that, through the recently formed Inter-Agency Committee on Inflation and Market Outlook, the government intends to promptly anticipate food and energy market conditions and generate evidence-based and timely recommendations to the President and the Cabinet.
