Battling with Inflation
The high prices of food, fuel and transport are testing the patience of Filipino consumers. It is common for ordinary Filipinos nowadays to complain about their shrinking budget.
President Ferdinand Marcos Jr. is not oblivious to the complaints of the consumers. He knows the problem well, even conceding that life “is getting hard” for Filipinos amid rising inflation.
Immediately easing the plight of the ordinary Filipinos, however, is not that easy. But the government can lighten the burden of the poorest of the poor. President Marcos, in response, has committed to giving continuous assistance to vulnerable sectors that are most hurt by surging consumer prices.
The last few weeks were indeed trying times for Filipino consumers. We have heard of the ordinary consumer cursing at the high prices of vegetables in the public and wet markets. White onion is being sold as high as P400 a kilo, while the medium-sized red variety is being peddled at P350 a kilo, or P15 apiece. The calamansi can be bought for P1 per piece, while one can buy green chili pepper for sinigang for P5 to 10 apiece, depending on its length. The price of ampalaya, or bitter gourd, meanwhile, has risen to P180 a kilo from just P100 a few months ago.
It is no wonder then that the October inflation rate rose to an almost 14-year high of 7.7 percent year-on-year. The high inflation rate in key commodity groups, especially food and non-alcoholic beverages, was one of the major contributors to the steeper rise in prices in October. Food prices increased 9.4 percent in September from 6.9 percent in October, and accounted for 18 percent of the overall inflation rate.
The bad weather in October disrupted the food supply chain for certain vegetable products. President Marcos, though, presented a wider perspective on the supply chain problem.
He stressed the need to solve the logistics problem bugging the agriculture sector in order to lower food prices in the Philippines. I am in full agreement with his observation. The flow of agricultural goods in the country is hampered by old practices. We often hear about the complaints of forwarders and cargo handlers on the restrictions imposed by certain local government units, as well as the presence of several checkpoints along the food delivery route.
Straightening out the logistical problem in the food sector is just one solution. Improving the yields of the farmers is equally important, as well as resorting to the timely importation of critical commodities during times of shortages.
Financial assistance to farmers, of course, is critical. The provision of cold storage facilities, for one, will modernize our farming methods and increase the earnings of growers.
Land Bank of the Philippines made a timely intervention when it approved P1.1 billion in loans to support the production and trading of onion and the acquisition of cold storage equipment.
Onion is a high-value crop that the Philippines should nurture. I am encouraged by the success story of some 20,000 onion farmers in Nueva Ecija and neighboring towns, who enjoyed bountiful harvests because of a cold storage facility financed by Land Bank. That facility can accommodate up to 450,000 bags of onions.
Post-harvest facilities are crucial to raising the country’s agricultural production. The Nueva Ecija cold storage helps prolong the shelf life of onion and lower post-harvest losses from insect infestation. They also help farmers in selling their produce at a competitive market price.
The same is true with our fishermen. Cold storage plants give our fishermen more leverage in selling their products than offering their produce immediately to traders.
Such post-harvest facilities at the end of the day will reduce agricultural losses or spoilage, in the case of rice, and better manage the supply. Some crops are produced only during the dry season or the wet season, but the demand for these products is all year round.
Preserving the quality of agricultural produce in post-harvest facilities ensures sufficient supply for the whole year. In sum, a modern agriculture sector utilizing modern technology and equipped with post-harvest facilities improves the yields of our farmers and fishermen. It leads to efficient production and stable supply. More importantly, it lowers prices of the commodities and the nation’s overall inflation rate.