Rice Inflation Slows to 14.7% in August

The inflation rate for rice in the Philippines slowed to 14.7% in August, down from 20.9% in July, according to data released by the Philippine Statistics Authority (PSA) on Thursday. The decline is attributed to base effects and the impact of reduced tariff rates for imported rice.

PSA chief and National Statistician Claire Dennis Mapa stated that this is the lowest inflation rate for rice since October 2023, when it was at 13.2%. The slowdown aligns with the PSA’s expectation that rice inflation would begin to ease in the second half of 2024 due to the base effects from its rise starting in August 2023 and the recent reduction in rice import tariffs.

Executive Order No. 62, which reduced the tariff rates for imported rice from 35% to 15%, took effect in early July. The PSA had previously indicated that this tariff reduction could lower the retail price of rice by P6 to P7 per kilo.

In August, the national average prices for various rice types showed a decrease from July:

• Regular milled rice: P50.66 per kilo (down from P50.90 in July and P43.29 in August 2023)
• Well-milled rice: P55.56 per kilo (down from P55.85 in July and P47.65 in August 2023)
• Special rice: P64.08 per kilo (down from P64.42 in July and P56.24 in August 2023)

Mapa expressed optimism about the trend, stating, “We hope to see bigger drops in the coming months,” and predicted that rice inflation could fall to single digits by September.

The decline in rice inflation comes after a year of double-digit increases, beginning in September 2023 at 17.9%. To mitigate the impact of higher rice prices on consumers, the Department of Agriculture launched the Rice-for-All program on August 1, allowing the general public to purchase rice at P45 per kilo at select Kadiwa outlets. This initiative follows the P29 Rice Program, which offers subsidized rice at P29 per kilo to vulnerable sectors at various Kadiwa outlets.