Philippines halts rice price cuts and tariff hikes amid global unrest, fuelling uncertainty and rising costs for consumers and food manufacturers
Rice is the major food commodity in most Asian countries, including the Philippines which is also one of the world’s major importers.
Rice prices in this market have however been anything but stable over the past year, due to the effects of El Nino last year causing a dip in local supply, as well as a rice export ban by major supplier India to manage its own rice supply needs in 2023.
Philippines President Ferdinand Marcos Jr. announced a major drop in rice import duties from the regular 35% to 15% last year in order to attract more rice imports, but now the potential supply crisis has passed, calls are rife to have tariffs increased again.
“Unchecked rice imports are harming local farmers,” Nueva Ecija Representative Rossana Vergara told the Philippines Congress during a high-level committee meeting.
The influx imported rice has had an impact on the local farming community due to increased competition and the lowering of rice prices, but a sudden leap in tariffs would bring prices up again and cause another round of instability as well as pressure on consumers, said the local Department of Agriculture (DA)
“The DA suggests a gradual increase back to the 35% duty instead of a sudden 20% hike,” DA Head Agriculture Secretary Francisco P. Tiu Laurel Jr. stated.
“We understand that an abrupt increase could shock not only the local market, but also ripple across the global rice trade as the Philippines is one of the world’s major rice importers.”
To pacify local farmers, the DA has instead proposed that tariff hikes be implemented during major harvest seasons instead of all year round for now, particularly for its main rice suppliers such as Vietnam and Pakistan.
““To minimize the impact on the local market, we propose timing the tariff hike to coincide with the harvest seasons of our major suppliers – this would be around late September for Vietnam and December for Pakistan,” he said.
To lower or not to lower?
In a move to reassure local consumers that rice prices would not be skyrocketing, the DA previously announced plans to further lower the Maximum Suggested Retail Price (MSRP) of rice in July 2025.
This would bring the MSRP from its current PHP45 (US$0.79) to PHP43 (US$0.76) per kilogramme.
But amid pressures from local farmers as well as the uncertainty of other commodity prices, the DA has been forced to delay this promise, keeping rice at its current price for now.
“We’ll likely delay the rollout by a month or two to gain a clearer picture of where global prices are heading,” Tiu Laurel said.
“We have to consider the heightened geopolitical impacts after US airstrikes in Iran, as this has threatened to expand the Israel-Iran conflict further across the Middle East, which remains a major source of global oil supply.”
Rising oil prices have major impacts on fertiliser production, transportation costs and the costs of agricultural inputs, so rice production would almost certainly also be impacted as a result.
Impacts already taking place
This has been exacerbated by the surge of oil prices having already taken place recently after Iran threatened closure of the Strait of Hormuz, which would affect an important route of global crude oil shipments.
“The effects could have a cascading effect across the agriculture sector, with fishermen already affected by higher fuel prices, farmers by fertiliser costs, and the entire country will feel the impact of elevated logistics costs pushing up the prices of imported food products,” he said.
“The market is extremely fluid. Any forecast I make now might not be accurate even an hour later.”
© Copyright 2025 The SSResource Media.
All rights reserved.