When the quantity desired exceeds the quantity available, the price rises. The soaring onion prices in the Philippines would require the country to import 22,000 tons of the vegetable by March, said agriculture officials. Part of the price increase is due to global inflation, caused by a variety of factors like Russia-Ukraine conflict, supply chain problems, and climate change. Other local crisis, such as price manipulation, are also to blame for the soaring onion prices. In the Philippines, inflation reached a 14-year high in December, with onions accounting for 0.3 percentage points of the 8.1% increase in consumer prices.

The local cuisine of the Southeast Asian nation frequently uses onions. Onion and garlic are commonly used in the preparation of many foods. The average monthly demand for the vegetable in the country is roughly 17,000 metric tons. However, according to the agriculture department’s monitoring of Manila-area market prices on 09 Jan 2023, red and white onions in the Philippines were selling for 600 pesos ($10.88) per kilogram, or about $5 per pound. This is almost three times as expensive as chicken and 25% to 50% more expensive than beef. A kilogram of onions costs more than the minimum salary for a day’s work in the Philippines.

The business community blames the agriculture department for failing to establish accurate supply forecasts. Agriculture experts anticipate onion and garlic shortages as early as August, when the local red onion type costs no more than 140 pesos ($2.54). However, the department blocked imports, claiming that existing supplies would enough, even though Philippine farmers warned that consumption would surge during the holidays. The Philippines’ trade agency set a suggested retail price (SRP) of 250 pesos ($4.53) per kilogram of onions on 30 Dec 2022. However, the trade department has the authority to penalize those who set prices higher than the SRP, but this is rarely enforced.  

Onions are in such high demand that they are being smuggled into the country, with authorities seizing multiple shipments. Last month, customs officials discovered an estimated $362,000 in illegal red onions from China camouflaged by boxes of bread and pastry products. Another $309,000 in smuggled white onions concealed by containers containing clothing. And some of the smuggled onions were discovered to be unsafe for human consumption because microorganisms such as E. coli and traces of pesticide were discovered on some batches.

The Philippines and China have signed a bilateral agreement to expand agricultural and economic cooperation but It is unclear whether such collaboration will include onion imports.