Food Prices Increase as Peso Weakens

With the continued depreciation of the peso versus the dollar, Philippine citizens will have to shell out more money as food prices rise.

In the previous week, the peso hit a new record low of ₱57.43 to $1.

With a weaker peso, this means more money would be needed to import raw materials and finished products needed in local food production due to these being paid in dollars.

The Philippines relies on imported food products and inputs so the agricultural sector is saying that the peso depreciation will negatively affect everyone.

“It is going to be hard on everyone, for consumers and producers alike,” said the United Broilers and Raisers Association (UBRA) President Elias Jose.

Meanwhile, the Philippine Chamber of Agriculture and Food Inc. (PCAFI)’s President Danilo Fausto has maintained that the consumers will experience increased food prices with the depreciation of the Philippine peso which brings up the prices of imported agricultural goods.

On the other hand, the weaker peso also indicates local farmers have a good chance against imported food items like rice.

“It could provide leeway for farmgate prices to move up to compensate farmers for higher costs of fertilizer, fuel, and other production inputs,”  said Raul Montemayor, National Manager of the Federation of Free Farmers (FFF).

According to Montemayor, the weaker peso would also be a good opportunity for exporters.

“But unfortunately, we have not established programs to help our exporters avail themselves of trade opportunities. We are a net food importing country now, so the net effect will be a higher agricultural trade deficit,” he says.

Source: Philstar