Philippines Sep rice inflation hits 14-year high despite price control measures

Rice prices in the Philippines rose at their fastest pace in September to a 14-year high, despite the imposition of a government cap on them, according to data from the Philippine Statistics Authority Oct. 5

In September, prices surged 17.9% on the year after an 8.7% increase in August, PSA chief Dennis Mapa said at a press briefing, contributing to a year-on-year rise of 6.1% in the consumer price index, the statistics authority said.

Although on Oct. 4 the Philippines President Ferdinand Marcos Jr. announced to lift "the price caps on rice for the regular milled rice and the well-milled rice," noting that they are declining amid the start of harvesting and an improvement in the global supply outlook, PSA chief Dennis Mapa admitted that determining the effectiveness of the price control measures needs further study.

Marcos, also the country's agriculture secretary, said to local media that the Philippines, one of the world's biggest rice importers, has an adequate supply of rice.

The Philippines imposed price ceilings on rice Sept. 5 after what Marcos said was an "alarming" increase in rice prices, caused by what he said was illegal price manipulation by domestic market participants, on top of external factors like the conflict in Ukraine and India's ban on non-Basmati white rice exports.

The maximum retail price was set via an executive order at Peso 41/kg ($0.72/kg) for regular milled rice and Peso 45/kg for well-milled rice.

One Vietnamese trade source said that Philippine buyers are concerned about potential new anti-hoarding measures.

"There is a new law being crafted that makes it difficult for us to stock rice," a rice importer from the Philippines told S&P Global Commodity Insights.

"Anything [worth] more than $20,000 [of rice] in their warehouse can get them to jail. Also, price manipulation and profiteering mean they make so much profit. If they buy at a high price and sell based on the buying price, they will be charged with profiteering. They will go to jail immediately."

The Filipino rice importer added that "the new law is being formulated, it has been approved in Congress, and once the Senate opens, it will be approved, which is estimated to be during end-October or early November."