Amid rainy weather, the cost of manufacturing inputs in the Philippines rose to a five-month high in August, ending three consecutive months of decline.

Preliminary Philippine Statistics Authority (PSA) data on Tuesday, Sept. 30, showed that the year-on-year producer price index (PPI) for manufacturing increased by 0.6 percent in August, reversing the three-month trend of declines, which ranged from -0.1 to -0.2 percent from May to July.

In contrast, manufacturing PPI had dropped by 1.3 percent year-on-year in the same month last year.

On a month-on-month basis, PSA data showed that manufacturing PPI rose 0.2 percent in August, faster than the 0.1-percent increase in July. By comparison, manufacturing PPI had declined by 0.5 percent month-on-month in August 2024.

The PSA attributed the annual growth in manufacturing PPI mainly to a smaller decline in the manufacture of computer, electronic, and optical products, which eased to 0.1 percent in August from one percent in July.

The PSA also noted that other contributors included faster growth in the manufacture of basic metals in August, which rose to two percent from 0.4 percent in July, and a smaller decline in the manufacture of transport equipment, easing to 0.2 percent from 1.3 percent in the previous month.

PSA data showed that the top contributors to the overall annual growth in August manufacturing PPI were the manufacture of coke and refined petroleum products (5.9 percent, up from 4.6 percent in July), the manufacture of food products (0.6 percent, up from 0.5 percent), and the manufacture of basic metals (two percent, up from 0.4 percent in July).

Meanwhile, the PSA also emphasized that some sectors recorded negative annual growth rates in August. These included the manufacture of other non-metallic mineral products (-3.8 percent, slightly improved from -4 percent in July), electrical equipment (-4.1 percent, up from -4.2 percent), and machinery and equipment, except electrical (-0.8 percent, up from -1.1 percent).

The year-on-year growth rate for the manufacture of food products increased to 0.6 percent in August from 0.5 percent in July, although lower than the 0.7-percent annual growth recorded in August 2024.

PPI for the manufacture of food products slipped by 0.02 percent month-on-month in August, after a 0.2-percent rise in July. In the same month last year, the sector’s PPI declined by 0.1 percent month-on-month.

Michael Ricafort, chief economist at Rizal Commercial Banking Corp. (RCBC), told Manila Bulletin that the increase in PPI for manufacturing last August was mainly driven by weather-related disturbances from a series of storms, typhoons, and floods, which caused temporary supply disruptions in heavily affected areas across the country.

However, Ricafort noted that prices are expected to ease once the supply situation stabilizes, supported by the inflow of goods from other areas and the resumption of vegetable and crop planting.

“Some price freezes in areas declared under a state of calamity would also serve as an offsetting factor,” he added.

He further said that major global commodities imported by the country—such as oil, wheat, and soybeans—remain at some of their lowest levels in three to five years, which could also help mitigate overall prices and inflation.