News & Events

April 23, 2015

Cheap Fuel Should Cut Fish, Food Prices — Solon

The prices of fish and other food products should stay fairly low as long as fuel costs are down, according to a lawmaker.
“Fuel is the single biggest expense in fishing operations, and since fuel costs are down, there’s no reason for fish prices to go up,” said House Deputy Minority Leader Arnel Ty, who represents the sectoral party LPG Marketers’ Association (LPG-MA).
“Depending on the size of their vessels and onboard refrigeration, commercial fishing operators spend around 30 percent of their income on fuel,” said Ty, who speaks for the minority bloc in the House committee on trade and industry.
Galunggong was quoted at P140 per kilo and alumahan at P200 per kilo in Metro Manila’s public markets, as of April 7, based on a survey by the Philippine Statistics Authority.
“The deflationary impact of cheaper oil on consumer prices is widespread. It cuts across a broad range of food production, processing and manufacturing industries that are driven by fuel. So overall food prices ought to stay depressed,” Ty said.
Meanwhile, partially due to the steep drop in fuel costs, tuna prices, which have fallen from a peak of $2,350 per metric ton in 2012 to a low of $1,175 per metric ton in 2014, have remained deflated, according to COL Financial Group Inc., the Philippines’ largest online stockbroker.
In a research report, COL Financial said the Philippines’ biggest tuna canner, Century Pacific Food Inc. “is taking advantage of low tuna prices by stocking up inventory, considering that once canned, the shelf life of tuna is extended to three years.”
Oil firms rolled back their pump prices by P0.65 per liter for gasoline, P0.15 per liter for diesel and P0.25 per liter for kerosene on Tuesday.
Citing Department of Energy figures, Ty said the P28.70 per liter prevailing common price of diesel is down P11.55 per liter, or 28.7 percent, compared to six months ago.
The P41.95 per liter current common price of gasoline is down P10.10 per liter, or 19.4 percent.
LPG prices are now down as much as 20 percent, to a range of P508 to P728 per 11-kilogram cylinder.
The price of the global benchmark Brent crude oil has been hovering around $55 per barrel, from a high of $115 in June last year, owing to a global glut in supply amid falling demand.
Oil prices are anticipated to fall some more once the United States and Europe reach a nuclear deal with Tehran. The subsequent lifting of trade sanctions could mean a deluge of Iranian oil exports, according to energy market analysts.
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