SEVERAL members of Congress on Thursday expressed optimism that the September inflation caused by oil and rice price shocks had already peaked last month and prices are expected to normalize soon as President Ferdinand R. Marcos Jr.’s successive interventions take effect.
Albay Rep. Joey Sarte Salceda, chairman of the Ways and Means Committee of the House of Representatives, said the reported year-on-year inflation rate of 6.1 percent in September is “due to oil and rice price shocks during month” but “is expected to dissipate in the October figures” due to the sharp decline in global oil prices during the end of September and the President’s imposition of rice price cap.
“The September inflation figure is due almost entirely to rice price spikes and the global oil price spike. The PSA collects data on the first five days of the month, and on the 15-17th days, so it captured a lot of the speculative rise in global oil prices, but not the sharp declines that followed September 27,” Salceda said, noting this was a snapshot of the previous developments.
“In other words, this is probably the worst inflation rate we will record for the -ber months, and it gets better from here.”
Salceda said the September figures also do not capture the sudden decline in world prices and things are going to get better.
Aside from rice, Salceda also noted a sharp decline in the sugar inflation rate, as the milling season started in September. He said he expects better prices in the October and November inflation figures, as the milling also peaks during that period.
“I am also pleased with corn and meat figures. Corn is down to 1.6 percent inflation and meat, its most correlated food product, is down to 1.6 percent inflation. As I frequently emphasize, we have a future in these areas. Maybe even better prospects, long-term, than the rice industry. Combined, it’s a bigger share of the economy anyway,” Salceda said.
Despite having optimistic predictions for the inflation rate in October and beyond, Salceda said the government “still need to mitigate risks.”
Food prices still need to be watched out for, especially because the ber months typically tend to be bonus season, which is naturally inflationary, the lawmaker said, noting with sufficient food, the government can manage the inflationary impacts of sudden injections of income among employees.
According to Salceda, there is no alternative to producing more and more rice per hectare, in which the Department of Agriculture (DA) under President Marcos, has already produced a bumper crop early this year and that should be maintained.
Meanwhile, Senior Deputy Speaker and Pampanga Rep. Aurelio “Dong” Gonzales Jr. said Filipinos could expect inflation, or the rate of increase in consumer prices, to go down in the days ahead.
Consumer prices, Gonzales said, rose primarily due to increases in the prices of rice and oil products, with the spike in fuel cost causing domino effect on transportation and electricity, impacting all products.
“But the bold decision of President BBM to impose a price limit on rice brought down the selling price of the staple last month, which meant that inflation should correspondingly go down,” Gonzales said.
Although the government can control rice prices, it has little influence on the retail rates of oil products which are largely dictated by the cost of imported crude oil in the world market.
Nevertheless, the administration is trying to help the poor and transportation sectors that are greatly affected by high fuel, power and consumer prices by extending financial assistance through the appropriate state agencies like the Department of Social Welfare and Development (DSWD) and the Department of Transportation (DOTr), he said.
“President BBM is doing his best to fix the complex problems of the agriculture sector. And Congress has been helping him by passing the needed legislative measures like the law condoning the debt of more than one million farmers so they can produce more rice and other products. But putting the house in order will take time. Let us be patient for the results,” Gonzales stressed.
Quezon Rep. Mark Enverga also expressed optimism that inflation had peaked in September, expecting prices of all major agricultural products would soon decline.
Enverga, the chairman of the House Committee on Agriculture and Food, attributed this positive outlook to the upcoming harvest season and the transformative agricultural initiatives implemented by President Marcos who also serves as the agriculture secretary.
“We believe that inflation has peaked, and we expect it to be on a downward trend because of the forthcoming harvest season. As the earth yields its bounty, we anticipate a steady decline in inflation rates,” Enverga stated.
The lawmaker emphasized the vital role the harvest season historically plays in stabilizing prices and alleviating economic pressures on the public.
He also highlighted the decline in prices of essential agricultural products, including sugar, as a result of strategic reforms in the agricultural sector.
The Quezon lawmaker lauded the President’s decisive actions in the agriculture sector, underscoring their importance in addressing deep-rooted problems that have persisted for decades due to neglect by past administrations.
The President made a commitment to revitalize agriculture sector by investing in infrastructure, technology, and sustainable farming practices, Enverga said, adding the administration not only improves the livelihoods of Filipino farmers but also fortifying the foundation of the economy.
The Philippine Statistics Authority (PSA) reported that inflation in September 2023 rose to 6.1 percent, up from 5.3 percent in August, bringing year-to-date inflation to 6.6 percent.
The increase is primarily attributed to higher food prices, which surged to 10 percent from 8.2 percent in August. Key contributors include rice (17.9 percent from 8.7 percent), meat (1.3 percent from -0.1 percent), fruits (11.6 percent from 9.6 percent), and corn (1.6 percent from 0.9 percent).
