MANILA — Rice imports to the Philippines are projected to increase this year as domestic production struggles to keep pace with demand, according to a report by the United States Department of Agriculture (USDA).

In its “Philippines: Grain and Feed Annual” report dated March 30, 2026, the USDA’s Foreign Agricultural Service in Manila forecast rice imports to reach 5.1 million metric tons (MT) in marketing year 2026–2027, up 15.9% from 4.4 million MT in the previous year.

Local palay production is expected to grow slightly by 0.4% to 19.68 million MT, as higher input costs for fertilizers and petroleum products offset government support and favorable weather conditions.

Based on a milling recovery rate of 63% reported by the Philippine Statistics Authority, this output translates to 12.398 million MT of rice, which is below the projected consumption of 17.65 million MT for the same period.

“Despite a forecast marginal increase in palay output and slight improvements in yields in MY 2026-2027, continued population growth will increase demand for staple food products, particularly rice, and keep overall consumption on an upward trend,” the USDA said.

The report also noted that a four-month rice import ban imposed in marketing year 2025–2026 reduced available stock for carryover, prompting expectations that both government and private importers will rebuild inventories.

“At the same time, the four-month rice import ban within MY 2025-2026 reduced the stocks available for carryover into MY 2026-2027, supporting Post’s assessment that the government and commercial importers and traders will rebuild stocks from domestic production and imports to manage supply and price risks,” it added.

President Ferdinand Marcos Jr. ordered the rice import ban in August 2025 to stabilize prices and support local farmers. Initially set to last until October, the measure was extended until the end of the year.

The Philippines has also implemented a quarterly price-indexed tariff system for rice imports, with duties ranging from 15% to 35% depending on global price movements.

“Industry contacts note that basing tariff rates solely on international prices, rather than considering domestic demand, may inadvertently encourage market speculation, as readily available price information could prompt some actors to withhold stocks in anticipation of further price changes,” the USDA report read.

“Meanwhile, some stakeholders continue to advocate reinstating the 35% import tariff to provide greater protection for the local rice industry,” it added.

Earlier this month, Marcos announced a P50 price cap on imported milled rice after the Department of Agriculture flagged what it described as “unreasonable” price increases linked to global oil market disruptions.

Agriculture Secretary Francisco Tiu Laurel Jr. said the government is addressing rising production costs, particularly for fertilizers, amid the ongoing Middle East conflict.

“Supply is not the main concern; rather, it is the upward pressure on global prices driven by logistics costs and market uncertainty,” he said.

“Actually, everything will be affected,” he added, noting that higher transport and input costs could raise food prices by around P2 to P5 per kilogram.

The Department of Agriculture said that in 2025, about 20% of the country’s imported urea-based fertilizers came from Qatar and Saudi Arabia, while most were sourced from Brunei, Malaysia, China, and Vietnam. Ammonium sulfate fertilizers were sourced entirely from China and Japan.

To mitigate rising costs, the agency said it is promoting alternatives such as liquid fertilizers, biofertilizers, and soil ameliorants.

“We have many strategies,” Tiu Laurel said, expressing confidence that these measures will help stabilize supply and cushion consumers from further price increases.