The Philippine Statistics Authority (PSA) on Wednesday warned that the developing Super El Niño phenomenon could put additional pressure on food prices and inflation in the coming months.
Speaking at the Kapihan sa Manila Bay forum, PSA Assistant National Statistician Rachel Lacsa said extreme weather events have historically driven up food costs by damaging crops and disrupting transportation and logistics.
“In the past, typhoons indeed made prices of food rise because of the damaged harvests, as well as disruptions in transportation and logistics,” Lacsa said.
The PSA is set to release May inflation data on Friday. Earlier, the Bangko Sentral ng Pilipinas projected inflation for the month to settle between 7.1 percent and 7.9 percent, compared with the 7.2 percent rate recorded in April.
Rizal Commercial Banking Corp. chief economist Michael Ricafort earlier said inflation could reach at least 8 percent in May as the effects of the Middle East conflict continue to ripple through the economy, particularly in fuel and transport costs.
Despite the risks, Department of Economy, Planning and Development Undersecretary Rosemarie Edillon said the government does not expect inflation to return to double-digit levels.
“The last time we experienced double-digit inflation was in 2008. This time, we have already found ways to mitigate El Niño,” Edillon said.
She added that the government expects economic conditions to improve in the second half of the year, although elevated fuel prices remain a concern.
Agriculture Secretary Francis Tiu Laurel Jr. earlier said the government has reactivated its El Niño task force amid projections that rice production could decline by as much as 700,000 metric tons if dry conditions persist.
The Geneva-based World Meteorological Organization has forecast an 80 percent probability that El Niño conditions will develop between June and August, potentially affecting rainfall patterns and agricultural output across many regions.
