The spike in fertilizer prices is becoming a major headache for local rice farmers, who will start planting their dry season crop in November. As fertilizer accounts for more than half of their production cost, the recent price hikes would require farmers to cough up more money for the essential input. This would then make rice and corn—two of the country’s major staples—more expensive (See, “Rice set to climb as fertilizer rally drives up farm costs,” in the BusinessMirror, October 23, 2021).
Data from the Fertilizer and Pesticide Authority showed that the prices of inorganic fertilizers commonly used in the Philippines went up across the board compared to their year-ago levels. As of October 15, FPA data indicated that urea (prilled) was sold for P1,630.95 per 50-kilogram bag, or 56 percent higher from a year ago while granular urea was priced at P1,580.22, which is nearly 60 percent higher than last year’s prices. The yield-enhancing urea was most expensive in Pangasinan where it was sold for P1,900 per 50-kg bag.
Figures from the attached agency of the Department of Agriculture also showed that ammonium sulfate went up by 41 percent year-on-year; complete, 30 percent; ammonium phosphate, 30 percent; MOP, 20 percent; and DAP, 23 percent. Prices are expected to remain elevated due to recent international developments, such as the energy crises in Europe and China.
The Philippines, a net importer of rice, is not only the country that is grappling with the tightness in fertilizer supply. Vietnam and Thailand, two of the Philippines’s top sources of rice, are also heavily dependent on other countries for inorganic fertilizers. Thailand is a major customer of China, which has recently decided to curb fertilizer exports, causing global fertilizer prices to soar to new records.
China accounts for about 30 percent of global fertilizer trade and its biggest buyers include India, Pakistan and countries in Southeast Asia. Farmers in Thailand who will plant rice soon would also have to buy more expensive fertilizer. Because of the price surge, Vietnam’s plant production department has also encouraged farmers to cut fertilizer use by half, which could affect their output.
Compounding the woes of rice-producing countries like the Philippines is the increase in international oil prices and the container crisis, which have contributed to the cost of importing fertilizer. The government is now considering several measures to provide relief to farmers, including the provision of additional subsidies, subject to the availability of funds (See, “DA readies short-, long-term ways to cut fertilizer prices,” in the BusinessMirror, October 25, 2021).
Among all the measures that the government is “exploring” to help farmers cope with the increase in fertilizer prices, the provision of additional subsidies can be done immediately. Policymakers have recently given jeepney drivers a fuel subsidy amounting to P1 billion (See, “Government bares P1-billion fuel subsidy for drivers,” in the BusinessMirror, October 25, 2021). We urge the government to also give our farmers meaningful assistance that will help them survive the fertilizer crisis. We don’t want soaring fertilizer prices to kill our ailing agriculture sector. Our farmers play a strategic role in improving the availability of affordable food for all Filipinos, and we depend on them for our food security.