Agriculture Secretary Francisco P. Tiu Laurel, Jr. expressed cautious optimism over the sharp slowdown in September inflation, driven by a decline in food prices, particularly rice.

Inflation in September decelerated to 1.9 percent, its slowest pace since the 1.6 percent recorded in May 2020, when the economy nearly came to a halt due to lockdowns aimed at curbing the spread of Covid-19.

Food inflation played a significant role in this overall deceleration, with the inflation rate for rice dropping to 5.7 percent from 14.7 percent in August.

Rice, a staple in the consumer basket, accounts for 9 percent of the basket of goods and services used to track inflation for all consumers and doubles to 18 percent for families in the bottom 30 percent income bracket.

“Food prices have significantly declined from the highs posted in the same period last year, with vegetables such as onion and tomatoes, sugar, fish and rice leading the way with the help of various interventions of the Marcos administration,” Tiu Laurel said.

The DA chief added that rice prices should start reflecting the reduction in the tariff on imported rice—from 35 percent to 15 percent—and the lifting of India’s export ban later this month. However, he cautioned that the typically high demand ahead of and during the Christmas season could temper the decline in food prices.

He noted that a more significant reduction in rice prices is expected in January, as the current rice inventory, imported at higher prices and tariffs, is fully consumed.