Not enough cheap rice behind surge in prices of basic items

CEBU CITY — The low supply of cheap rice in the market is one of the main reasons why prices of basic commodities are on the rise.

This was revealed by Zeno Ronald Abenoja from the Department of Economic Research of the Bangko Sentral ng Pilipinas (BSP) during the public information campaign forum on inflation Sunday here.

The forum was attended by at least 100 participants from the academe, government agencies, Cebu Chamber of Commerce and Industry (CCCI) and Cebu Bankers Club.

Abenoja said a survey by the Philippine Statistics Authority (PSA) on poor families showed that 20 percent of their budget goes to buying rice.

Also contributing to the price increase of basic commodities was the constant change in weather that prevents farmers from delivering enough supply of rice to the markets in the region.

Unlike in Central Visayas, regions that are considered rice-producing areas are not experiencing a price rise.

The BSP said other factors behind the price surge are the soaring oil prices in the global market, and the higher excise tax on oil and sweetened beverage due to the implementation of the Tax Reform Acceleration and Inclusion (TRAIN) Law.

Ira Camarao of the Department of Finance’s Strategy, Economics, and Results Group said the effects of the TRAIN Law in the price increase is only at 0.4 percent of the total 5.7 percent inflation rate in July.