DA seeks higher budget to boost vegetable supply

MANILA, Philippines — The Department of Agriculture (DA) is scrambling to get additional budget to boost local vegetable production amid accelerating inflation of the commodity group.

The surge in vegetable inflation has been flagged as one of the contributors to faster overall headline inflation in the country. Officials attributed the uptick in vegetable prices to weather disturbances that caused supply disruptions.

According to the Philippine Statistics Authority (PSA), inflation of the commodity group vegetables, tubers, plantains, cooking bananas and pulses in September accelerated to 19.4 percent from 10 percent in August.

In particular, inflation of leafy or stem vegetables, where broccoli belongs to, remain elevated at 16.8 percent despite being slower than the 24.5 percent recorded in August.

Inflation of other vegetables, which include carrots and onions, accelerated to 25.6 percent, its fastest rate in two years, based on PSA data. The commodity group of other vegetables do not include fruit-bearing vegetables and green leguminous vegetables that have their own specific price growth indexes.

Inflation of the three commodities in the National Capital Region were even faster compared to the national average.

In NCR, inflation of the entire group of vegetables, tubers, plantains, cooking bananas and pulses hit 20.5 percent. Meanwhile, leafy or stem vegetables had an inflation of 22.8 percent, while other vegetables hit 26.9 percent.

The Bangko Sentral ng Pilipinas noted that higher vegetable prices caused by recent weather disturbances drove food inflation in September to accelerate faster. Food inflation last month inched up to 0.8 percent from 0.6 percent in August.

The DA reported that the combined effects of southwest monsoon and Typhoons Mirasol, Nando and Opong damaged at least P5 billion worth of agricultural products nationwide. Based on its latest report, at least 60 percent of damage and losses were recorded in the rice sector, followed by high value crops at nearly 24-percent share.

In particular, the weather disturbances damaged 45,339 metric tons (MT) of lowland and upland vegetables, commercial crops, root crops, spices, legumes and fruits resulting in a value loss of P1.2 billion, according to the DA.

Agriculture officials have pointed out that the supply shocks experienced by vegetables are temporary given the series of weather disturbances that hit the country.

To immediately address the supply woes and temper price increases, Agriculture Secretary Francisco Tiu Laurel Jr. said he approved the importation of certain vegetables –– carrots, broccoli and onions –– without announcing it publicly.

In September, some 51 MT of fresh carrots from Australia worth P2.16 million entered the country, based on Bureau of Customs data.

BOC data also showed that almost 16,000 MT of fresh yellow onions were imported from August to September with an average landed cost of about P35 per kilo.

Meanwhile, fresh red onions started to enter the country last month, with some 598 MT imported, based on BOC figures. The landed cost of imported fresh red onions, which includes tariffs, was around P33.6 per kilo.

From August to September, 513 MT of broccoli arrived in the country with an average landed cost of almost P76 per kilo, BOC data showed.

DA price monitoring reports indicated that the price of carrots as of Oct. 8 remain elevated as it cost as much as P300 per kilo with a prevailing tag of P250 per kilo. Meanwhile, broccoli prices range from P150 to P450 per kilo from last month’s P270 to P410 per kilo price range, based on DA reports.

Red onions meanwhile continue to see an upward pressure in prices as it now costs as much as P200 per kilo compared to the upper limit recorded last month of P170 per kilo, DA data showed.

However, DA’s medium-term solution for the country’s vegetables sector hit a roadblock as the budget for its high value crops program, which includes vegetables, is seen to go down next year.