Congress think tank: Rice prices projected to surge by up to 19.4%

THE PRICE of regular-milled rice in the Philippines could increase by between 9.1% and 19.4%, equivalent to about P5-P10.6 per kilo, due to the fertilizer shortage, according to a policy brief released by the Congressional Policy and Budget Research Department (CPBRD) of the House of Representatives.

The brief, “Seeds of a Food Crisis: Fertilizer Supply Disruptions in the Philippines Amidst the US-Iran Conflict,” also warned that the impact of a looming dry spell could further disrupt the rice market.

According to the study, the poorest families could face up to P490.8 in additional monthly rice costs, equivalent to up to 8% of their average monthly food budget.

The think tank called these estimates conservative because they only examine the direct impact of fertilizer prices and do not include other threats to the economy.

According to the CPBRD, escalating uncertainty over the availability of Middle Eastern commodities has caused a severe economic crisis. Following the closure of the Strait of Hormuz, worldwide fertilizer shipments have plunged by 97.8%

As a result, the global price of urea nearly doubled between February and April 2026 to record levels.

The Philippines’ is heavily dependent on imported fertilizer, with almost 90% of its total needs purchased overseas, according to the report.

According to the CPBRD’s econometric modeling, the impact of the crisis will gradually be felt at retail level over the next two or three years.

The CPBRD said the estimated P490.8 monthly cost increase is the minimum possible impact. According to the report, the real burden could be even higher if other factors are included such as the increase in oil prices and the decrease in harvest due to El Niño.

The paper proposed a more balanced fertilizer mix combining organic and chemical inputs, expanding crop insurance, and providing direct financial assistance to poor families for limited periods.

Meanwhile, the report advised legislators against implementing strict price caps or controls on rice prices and widespread subsidies that do not target the needy.

According to the CPBRD, artificially controlling rice prices will discourage businesses from importing and producing food, which could escalate the crisis to actual food shortages instead of merely expensive rice.

IBON Foundation Executive Director Jose Enrique A. Africa said the crisis exposes a deeper structural weakness in Philippine food policy beyond short-term price pressures.

Mr. Africa told BusinessWorld that the core issue is not simply supply diversification or expanding domestic fertilizer production, but the country’s long-standing dependence on imported agricultural inputs across the entire production system.

“The real issue is not just how to import more chemical-based fertilizer from different countries or manufacture more domestically, but how to reduce dependence of the country’s agriculture on imported inputs in the first place,” he said via Viber.

He said food security is conventionally framed around availability of food and consumer prices, but this approach overlooks whether farmers control the resources needed for production.

Mr. Africa added that this dependence is rooted in decades of policy choices, including Green Revolution strategies.

He also pointed to the shift from an agricultural trade surplus to a growing deficit following the Philippines’ entry into the World Trade Organization in the 1990s.

Mr. Africa proposed subsidies to stabilize fertilizer access.

“Fertilizer access can be stabilized with fertilizer subsidies and low-interest credit for farmers astride emergency procurement from multiple supplier countries to build up domestic buffer stocks,” he said. — Pexcel John Bacon