LAGUNA: Logistics players in the Philippines are warning that cost pressures caused by the fuel shock are likely to raise prices of basic goods ahead of a planned price hike by manufacturers that has already been delayed twice.
Price increases for some basic necessities and prime commodities, such as canned goods, bread, bottled water, soap and detergent, are set to take effect from May 10, the Department of Trade and Industry said on April 17, extending earlier deadlines of April 16 and April 30
This follows rounds of negotiations between the government, manufacturers and retailers.
Even so, prices in March have already risen at the fastest pace in nearly two years – after US and Israeli strikes on Iran on Feb 28 effectively brought maritime traffic along the Strait of Hormuz to a standstill, creating the worst energy crisis in history.
Inflation spiked to 4.1 per cent year on year in March, the highest since July 2024. Economists are expecting inflation to remain above 4 per cent in 2026, significantly higher than 2025’s 1.7 per cent and exceeding the central bank’s target range of 2 per cent to 4 per cent.
An April 15 report from HSBC Global Investment Research warned that the current oil shock could evolve into a broader “food shock” for Asean countries, with higher energy costs eventually pushing up food prices and adding a second wave of inflationary pressure.
The HSBC economists noted that “the Philippines (is) the most exposed” in the region to such risks, along with Singapore, because the two countries are Asean’s net importers of food.
“The Philippines’ agricultural sector has yet to catch up with its fast-growing population, with the archipelago having the highest fertility rate in Asia,” the HSBC economists said. The Philippine population is around 117 million as of 2026, according to government data.
In an archipelago that relies heavily on ground transport to move food and goods, the impact is being felt first by logistics companies as well as truck drivers, the workers who keep supply chains moving.
Diesel prices in the Philippines surged by around 50 per cent, pushing pump prices to as high as 151 pesos (US$2.46) per litre in some areas in early April before easing to about 100 pesos in recent weeks, with rollbacks of about 50 pesos per litre following a ceasefire in the Middle East.
Mary Zapata of the Confederation of Truckers Association of the Philippines said that filling a standard truck tank now costs around 14,000 pesos, up from about 6,000 pesos previously.
At the same time, operators are facing tighter cash flow constraints. Zapata said fuel purchases that were previously on 30 to 60-day credit terms are now largely cash-based, forcing companies to limit trips based on how much fuel they can afford upfront.
“You can run only as many trips as your cash allows,” she said.
At Protege Logistics Philippines Inc, which operates around 460 trucks serving clients that manufacture canned goods, personal products and products for a popular local fast-food chain, deliveries are still running as scheduled for now – but trucks are running with only half-filled fuel tanks.
Drivers are now being ordered to load only enough fuel to cover specific routes – usually around 50 per cent of tank capacity – instead of filing tanks fully, a shift from previous practice when trucks would run on a full tank to handle multiple deliveries, administrative and human resources head Omar Tigno told The Straits Times.
The change requires tighter trip planning and reduces flexibility for additional deliveries, even as companies try to stretch fuel and manage costs.
The Laguna-based company raised hauling fees in March to reflect the sharp rise in diesel prices, but Tigno said these have not yet been fully passed on to consumers as manufacturers continue to absorb the higher costs.
“Of course we want to avoid increasing fees as much as we can. But ultimately, the end-consumer will have to shoulder it,” he said.
Large manufacturers are still able to cushion the impact for now through fuel surcharges and existing inventory, said Pierre Curay of the Supply Chain Management Association of the Philippines, noting that some companies hold between 30 days and as much as six months of stock.
“Until end-April, prices are going to be stable. If there’s going to be increases, it’s not going to be too dramatic,” Curay told ST.
“But come May, when all inventory diminishes, then we don’t have any choice. Prices will increase.”
Truck driver Joseph Gayoso, 54, told ST he is now packing meals to save costs.
“We used to buy from roadside eateries wherever we were because it was affordable. But now, even that is too expensive,” said Gayoso.
The father of three said a cup of rice that once cost 10 pesos now sells for as much as 25 pesos, a jump that quickly adds up for workers who spend days on the road.
Unlike salaried workers, they have little buffer against rising costs. Many truck drivers are paid per round-trip delivery, meaning their earnings depend directly on how often they are dispatched. A driver operating a smaller vehicle may earn around 600 to 800 pesos per trip, while those handling larger 10-wheeler trucks can earn about 1,200 pesos.
“There might come a time that even our trips to deliver essential goods and supplies would have to be lessened,” he said.
Truck drivers employed by private logistics firms have so far been left out of the Philippine government’s fuel and cash subsidy programmes, which have been rolled out in phases and prioritised sectors such as public transport drivers and fisherfolk most directly affected by rising oil prices.
“It seems quite unfair. We’re earning more or less the same income as jeepney drivers,” Gayoso said.
“Truck drivers transport the food people eat. Shouldn’t the government consider that, too?” - The Philippine Daily Inquirer/ANN
