(Bloomberg) — The Philippines’ agriculture department is planning to import 22,000 tons of onions to boost domestic supply as surging prices of the cooking ingredient, possibly the most expensive in the world, helped push inflation to a 14-year high.
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The import proposal was arrived at during a meeting of the department’s executive committee and will be recommended to President Ferdinand Marcos Jr. for approval, its assistant secretary Rex Estoperez said in a phone interview Sunday. Marcos is also the agriculture secretary.
The proposed purchase “will be good for a month and to pull down prices,” Estoperez said. “We can’t sit idly because one of the drivers of inflation is the price of onions.”
The purchase would be a “temporary solution” and there are no further plans to import for now, he said. The Southeast Asian nation consumes around 17,000 tons of onions a month, Estoperez said. The agriculture department expects the planned imports, once approved, would arrive no later than the first week of February, he said.
Philippine Inflation Stubborn at 2008 High Means More Rate Hikes
Red onions were selling for as much as 650 pesos ($11.68) a kilogram in the Philippines and the white variety was priced as high as 600 pesos, about three times the price of chicken and around 25% costlier than beef, based on the retail prices of farm commodities monitored by the agriculture department as of Jan. 5.
Onion is a key ingredient in Filipino cuisine which most households use along with garlic. The price spike hit consumers particularly hard during the yearend holidays with food taking centerstage in many gatherings, prompting not a few to air their rants on social media.
A drop in local output helped lift onion prices, said Estoperez. Onions contributed 0.3 percentage points to the Philippines’ overall inflation, the same as rice, National Statistician Dennis Mapa said in a briefing last week. Consumer prices in December rose 8.1%, reaching a 14-year high, from 8% the previous month.
Half of the planned imports will be distributed in the main island of Luzon and the remaining will be shipped to Visayas and Mindanao, Estoperez said. While domestic harvests are continuing, the output is only expected to peak in the March-to-May period, resulting in the need to augment supply, he said.
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