Feb factory output dips, but outlook is bright By Bless Aubrey Ogerio
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OCAL elections and cooling inflation are expected to support the Philippines’s manufacturing sector in the coming months, even as the factory purchasing managers’ index (PMI) showed a slowdown in February, according to a global financial analytics firm. In its latest report, S&P Global Market Intelligence noted that the country’s PMI score stood at 51 in February. This marks a slight decline for the second consecutive month from 52.3 in January and is below December 2024’s 32-month high of 54.3. Per S&P Global Market Intelligence, manufacturing conditions
have remained in expansion territory for the past 18 months, but the latest increase was modest and the weakest in nearly a year. “Underpinning the improvement across the Filipino manufacturing sector was a further improvement in demand trends and another monthly rise in new orders,” the report stated. The report also noted that after a period of robust growth in late 2024, the pace of expansion moderated in February. “The expansion in new factory orders was the weakest in seven months. Growth in new export orders also cooled. Subsequently, the expansion in production also moderated, with output growth at its
softest since July 2024,” it added. With demand cooling and production requirements adjusting, manufacturers scaled back on purchasing activity, marking the slowest rate of increase in 15 months. However, firms also reported a rise in backlogs for the first time in five months, indicating some pressure on capacity. “Although the rate of accumulation in work in-hand was modest, it was the most pronounced seen in nearly two years,” the report said. “Consequently, companies utilized their inventories to meet order requirements and thereby reduced their input stock holdings, signifying the first decrease in three months.” Nonetheless, even if the con-
fidence weakened to a 10-month low, firms remained optimistic about demand trends, with expectations that election-related spending could provide a boost. Maryam Baluch, S&P Global Market Intelligence economist, said that while the latest data indicated that output and new orders expanded at a slower pace, employment levels rose for the first time in three months as companies worked to meet demand. “Meanwhile, inflationary pressures eased, thus suggesting that the central bank will continue to proceed with a loosening of its monetary policy. This could in turn boost somewhat weakened business confidence and support further new order growth,” Baluch said.
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Tuesday, March 4, 2025 Vol. 20 No. 143
P25.00 nationwide | 2 sections 20 pages | 7 DAYS A WEEK
MAY STRAIN POWER GRID
HEAT WAVE EXODUS Students in Tanay, Rizal, ride an improvised banca across the Daraitan
River after classes were suspended due to extreme heat, while in Metro Manila, students shield themselves with umbrellas and portable fans as they navigate the scorching streets. At least eight cities in the capital region canceled classes as DOST-Pagasa warned that the heat index could soar to 46°C on Monday, March 3, 2025. Story in Second Front Page, A20. NONOY LACZA AND NONIE REYES
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By Lenie Lectura
HE Department of Energy (DOE) released on Monday afternoon the demand forecast for the year, possibly reaching 14,769 megawatts (MW) for Luzon, 3,111 MW for Visayas, and 2,789 MW for Mindanao. The numbers are higher than last year’s actual peak demand of 14,016MW in Luzon recorded last April 24; 2,681MW in Visayas on May 21,2024 and 2,577MW in Mindanao on May 22, 2024. “Without mindful consumption, this surge could strain the power grid, potentially leading to supply challenges and price fluctuations in the spot market,” DOE Secretary Raphael P.M. Lotilla said. In terms of supply for the year, the DOE said the maximum adjusted available generating capacity for Luzon is at 15,504 MW in Luzon, 3,040 MW in Visayas and 3,314 MW in Mindanao as outlined in the Grid Operating Maintenance Program (GOMP) 2025-2027 and committed power projects for 2025. The agency said there are new power projects under testing and commissioning those could add 1,890 MW
in Luzon and 193 MW in Visayas. Additionally, the Luzon-Visayas and Visayas-Mindanao high-voltage direct current (HVDC) interconnections enhance supply availability and improve reserve margins by enabling capacity sharing of 250 MW and 450 MW, respectively. Meanwhile, with this year’s La Niña, rainfall is expected to help moderate rising temperatures across the country. The National Irrigation Administration (NIA) has also assured the DOE that water releases will continue until June or July. This will be particularly beneficial for the Pantabangan and Magat dams, which serve both irrigation needs and the energy sector by helping meet Luzon’s power requirements. As temperatures rise with the onset of the summer season, the DOE See “Demand,” A2
BSP DOUBLING COIN DEPOSIT MACHINES AFTER NETTING P1.3B By Reine Juvierre S. Alberto
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@reine_alberto
OIN deposit machines (CoDMs) deployed by the Bangko Sentral ng Pilipinas (BSP) have collected P1.308 billion as of February 15, and the central bank targets doubling the number of machines by the second half of the year. Since the launch of 25 CoDMs on June 20, 2023, the total coin collection reached P1.308 billion. This amount is 5.91 percent higher than the P1.235 billion collected last month, January 15, 2025. In terms of pieces, the BSP said 326.188 million pieces of coins have been deposited. This is a 4.99-percent increase from the 310.679 million pieces of coins deposited in the previous month. Transactions made through the CoDMs reached 299,457 deposits since the program’s launch. Deposits also increased by 5.08 percent from the 284,974 transactions last month. The CoDMs accept 1 centavo, 5 centavos, 10 centavos, 25 centavos, P1, P5, P10 and P20 coins.
All denominations of the BSP Coin Series and New Generation Currency (NGC) Coin Series are accepted by the machine. BSP Deputy Governor Bernadette Romulo-Puyat told BusinessMirror that 25 more CoDMs will be deployed in the second half of 2025. “We will expand the project and install an additional 25 CoDMs nationwide this year,” Romulo-Puyat said. The BSP launched the CoDM Project in partner retail establishments across the Greater Manila Area to encourage the public to deposit idle coins in order to improve coin re-circulation in the country. The central bank had explained then that keeping millions of coins stuck in private places is not fiscally sound, because producing new coins is quite costly. The deployment of 25 CoDMs in select retail establishments of SM Store, Robinsons Supermarket and Festival Mall in the Greater Manila Area is the first phase of the project’s implementation. The initiative aims to address See “BSP,” A2
Coco oil exports breach $2B on rising global prices By Ada Pelonia
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@adapelonia
HE country’s earnings from coconut oil exports surged to over $2 billion last year as international quotations improved significantly, according to the Philippine Statistics Authority (PSA). Figures from the PSA showed that the value of crude and not chemically modified coconut oil exports jumped by 85.4 percent to $2.19 billion from $1.18 billion in 2023. Crude coconut oil grew by 51.3 percent to $1.24 billion in 2024 from $819.69 million, while coconut oil not chemically modified skyrocketed by 163 percent to $946.37 million from $359.78 million, based on PSA data. Netherlands was the top market of the Philippines’s coconut oil exports last year at $604.65 million, while the United States trailed at $537.53 million. Other top markets for the country’s shipments of the tropical oil were Malaysia at $312.21 million, Indonesia at $138.94 million, Italy at $127.21 million, and China at $110.32 million. PSA data also showed that the volume of coconut oil exports reached 1.67 million metric tons (MMT) in 2024, higher than the 1.13 MMT
outbound shipments recorded in the previous year. The United Coconut Association of the Philippines (Ucap) attributed the spike in coconut oil prices last year to the tightness in coconut supply caused by El Niño and rising global demand. Ucap said the average quotation of coconut oil settled at $1,512 per metric ton (MT) in 2024, or 40.78 percent higher than the average $1,074 per MT recorded in the previous year. Currently, it averages $1,980 per MT. The industry group traced the spike in coconut oil prices to a combination of factors. For one, El Niño stressed coconut trees, leading to a 20-percent reduction in yield since water scarcity affected productivity. Ucap said the booming demand for the tropical oil globally had also put pressure on prices. This rising demand was traced to a shift in market preference, where coconut oil is seen as a “more sustainable, organic, and natural alternative raw material” for a variety of uses such as culinary trends and personal care. “The combination of diminished supply due to El Niño and the persistent growth in global demand for coconut products have created the perfect storm for a spike in coconut oil prices over recent months.”
PESO EXCHANGE RATES n US 57.9900 n JAPAN 0.3853 n UK 73.0152 n HK 7.4557 n CHINA 7.9659 n SINGAPORE 42.9237 n AUSTRALIA 36.0350 n EU 60.3444 n KOREA 0.0397 n SAUDI ARABIA 15.4631 Source: BSP (March 3, 2025)