Rice supply in the Philippines is heading into a stable phase through mid-2024, courtesy of the ongoing spring harvest. Additional supplies from Vietnam and a possible price stabilization deal with Cambodia will also meet domestic demand.

As a consequence, the government assured on March 5 that rice prices will remain under 49 pesos ($0.88) a kg.

The above retail price will also likely scale down as the palay (unhusked rice) harvest peaks in March through April. 

After that date the government predicts a summer shortfall that will elevate the grain’s cost through September 2024. It is likely that prices in September will revert to late February highs of 49-50 pesos ($088-0.89) a kg.

Palay production in the earlier harvest of October to December 2023 fell by 2%, to 4.94 million tonnes. Hence there is high expectation for the peak March-May harvest to supplement current reserves.

El Niño Losses

One of the causes for the supply slump is the El Niño, especially in the drought-prone rice region of northern Luzon.

For the current harvest, there was only 0.11% in weather damage, which means reserves will reach springtime capacity. Some rice-growing regions however suffered significant losses, primarily Western Visayas, which lost 1000 rice hectares worth 127 million pesos ($2.273 million).

Overall, El Niño has cost the Philippines’ rice sector 284.27 million pesos ($5.09 million)  across 5,011 hectares. According to the Department of Agriculture (DA)’s Disaster Risk Reduction and Management Office, this amount applies to production losses.

The Philippines is already bracing for a price slip by opting to discuss the weather-related price stabilization issue with ally, Cambodia. 

President Marcos Jr. and Cambodia’s PM, Hun Manet, discussed the matter on the sidelines of the ASEAN-Australia session on March 4.

It is likely that the two will revise their existing trade deals on rice to accommodate any forthcoming price stabilization deal.

Besides Cambodia, Vietnam will keep PH grain coffers full with a minimum of 1.5 million tonnes of rice annually.

Ultimately, it is probable that the Philippines will eventually emerge the world’s largest importer of rice in 2024. The U.S. Department of Agriculture (USDA) forecasted 3.9 million-ton imports of rice for the country in the 2023-24 market year.