Amid typhoons and adverse weather conditions, the cost of manufacturing inputs increased in September, according to the latest preliminary data from the Philippine Statistics Authority (PSA).

The PSA reported on Thursday, Oct. 30, that the year-on-year producer price index (PPI) for manufacturing climbed by one percent in September, up from 0.6 percent in August.

In contrast, manufacturing PPI dropped by 1.4 percent year-on-year in the same month last year.

On a month-on-month basis, manufacturing PPI increased by 0.22 percent in September, slightly higher than 0.21 percent in August. In contrast, the index fell by 0.1 percent month-on-month in September 2024.

The PSA said the annual growth in manufacturing PPI was mainly driven by the rebound in the manufacture of transport equipment, which recorded a 1.6-percent year-on-year increase in September, reversing the 0.2-percent decline in August.

It added that transport equipment manufacturing contributed 35.6 percent to the overall uptrend in the annual growth rate of manufacturing PPI during the month.

The PSA also attributed the faster annual growth in manufacturing PPI for September mainly to the rebound in the manufacture of computer, electronic, and optical products, whose 0.9-percent increase reversed the 0.1-percent decline in August. It also cited the slower annual drop in the manufacture of other non-metallic mineral products, which eased to 2.2 percent from 3.9 percent in the previous month.

PSA data further showed that the main drivers of the annual growth in manufacturing PPI for September were the production of coke and refined petroleum products (5.1 percent, down from 6.1 percent), food manufacturing (0.83 percent, up from 0.79 percent), and the manufacture of basic metals (2.3 percent, up from two percent).

Meanwhile, PSA data showed that several sectors posted negative annual growth rates in September. These include the manufacture of other non-metallic mineral products, which declined by 2.2 percent from a 3.9-percent drop previously; the manufacture of machinery and equipment except electrical, which contracted by one percent from 0.8 percent; and the manufacture of beverages, which slipped by 0.5 percent from a one-percent increase in the previous month.

The year-on-year growth rate for the manufacture of food products rose to 0.83 percent in September, up from 0.79 percent in August, but remained below the 1.4 percent recorded in the same month last year.

PPI for food products manufacturing recorded a slower month-on-month increase of 0.02 percent in September, easing from 0.1 percent in August. In contrast, the same sector registered a 0.02-percent decline in September 2024.

Michael Ricafort, chief economist at Rizal Commercial Banking Corp. (RCBC), told Manila Bulletin that the rise in manufacturing PPI followed a series of storms and typhoons, as well as flooding, which temporarily pushed up prices in the hardest-hit areas.

Ricafort said that supply chains are expected to stabilize in the coming weeks.

“For the coming months, some seasonal increase in demand toward the Christmas holiday season could lead to some seasonal pick-up in PPI,” he added.