El Niño, rising costs to weigh on rice production

By Beatriz Marie D. Cruz, Senior Reporter

SINGAPORE — Soaring fuel and fertilizer costs linked to the Middle East conflict, coupled with drier-than-usual conditions, are putting increasing pressure on domestic rice production and threatening the Philippines’ food security, according to the International Rice Research Institute (IRRI).

“Rising fuel and fertilizer costs driven by Middle East tensions, along with the emerging threat of El Niño, weigh heavily on agricultural production and rice farmers,” IRRI Director-General Yvonne Pinto told BusinessWorld on the sidelines of the Philanthropy Asia Summit on Tuesday.

“The prospects for food security in the Philippines in two, three years from now are going to be much worse, unless we support and enable farmers to generate income from the rice they are producing,” she said.

Filipino farmers are now grappling with rising costs and unstable supply of fuel and fertilizer, which are essential to rice production, Ms. Pinto said.

The closure of the Strait of Hormuz has affected global supply of fertilizer and caused prices to spike. The Middle East is a hub for fertilizer production. In particular, the supply of urea from the world’s largest production facility in Qatar has been stopped due to the conflict.

For instance, the cost of urea, a nitrogen-based fertilizer, is 33% higher today, she noted.

Urea (prilled) prices averaged P2,607.42 per 50-kilogram (kg) bag between May 11 and May 15, significantly higher than the P1,686.03 per 50-kg bag in the same period last year, according to data from the Fertilizer and Pesticide Authority. 

“So, these geopolitical tensions really escalate the costs,” Ms. Pinto said. “What the government may have to do is provide safety nets to farmers so that they can afford them.”

Before the Iran war, the Philippine Department of Agriculture (DA) projected palay (unmilled rice) output to reach 20.28 million metric tons (MT) this year, under favorable weather conditions. This has been lowered to 19.87 million MT due to the Middle East conflict and the looming El Niño.

Ms. Pinto said the El Niño phenomenon threatens to disrupt the country’s rice production in the next few months.

The Philippine Atmospheric, Geophysical and Astronomical Services Administration recently warned of the possibility of a moderate to severe dry spell from June until early next year.   

The DA also estimated that agricultural output could be slashed by as much as 30% under a “Super El Niño” scenario.

In 2024, total damage to agriculture due to El Niño reached P15.3 billion, affecting 333,195 farmers and fisherfolk nationwide.

Ms. Pinto said there is a need to focus on reducing labor costs for rice production through better seed distribution, mechanization, and fertilizer supply.

In the medium and long terms, she called for capacity-building for fertilizer production and nature-based solutions like composting to improve affordability for farmers.

“Our analysis tells us we only need to raise yields by one ton per hectare,” Ms. Pinto said. “From all of the strategies I mentioned, it is achievable.”

She also emphasized better coordination between national and local governments to ensure farmers benefit from agricultural policies.

The country’s rice self-sufficiency ratio, which measures the capacity of local production, dropped to 71.7% in 2024, according to the Philippine Statistics Authority. The ratio was the lowest in 37 years, or since the data series began in 1988.

With the Philippines facing another El Niño this year, farmers should have increased access to early warning systems, alternative wetting and drying solutions, and irrigation equipment, Ms. Pinto said.

“These shocks are going to continue, so we’ve got to develop architecture that supports farmers to stay in farming to enable the Philippines to be food secure,” Ms. Pinto said.   

For the past 65 years, IRRI has worked closely with the Philippine government through science-based innovations to help reduce hunger and poverty through rice. Headquartered in Laguna, the organization promotes sustainable agricultural production, improved nutrition, and stronger livelihoods for farmers.