USDA sees slower sales for Philippines food, beverages

October 6, 2026 | 12:00am

MANILA, Philippines — The Philippines’ food and beverage retail sales are expected to grow at a slower pace this year due to rising costs and slower consumer spending, according to the US Department of Agriculture.

The USDA-Foreign Agricultural Service Manila said in a report that the country’s total food and beverage retail sales are expected to inch up by 1.6 percent to $123 billion this year from $121 billion last year.

It added that higher prices have softened household consumption and reinforced “price-sensitive, value-seeking consumer behavior.”

“Consumers are opting for cost-effective alternatives and focusing on essentials while others prioritize value over volume,” the USDA said.

The international agency also estimates that the sector could expand at a seven percent compound annual growth rate through 2030.

This will mainly be due to the entry of new retailers, the expansion of modern retail chains into key cities and rural areas and the continued consumer shift toward e-commerce.

Despite traditional retailers still making up the majority of the industry, the USDA said modern retailers are rapidly expanding to rural areas and offering a variety of products, such as imported options, and better value for its customers.

It added that local warehouse clubs, hypermarkets, supermarkets and convenience stores have been expanding into cities with high income communities by offering more imported selections and lower priced products.

The report also noted that food and non-alcoholic beverages remains the single largest component of household spending, accounting for 36 percent of the country’s total consumption.

The Philippine Amalgamated Supermarkets Association said retailers are adapting to weak consumer spending by offering smaller and more affordable products, while also increasing their prices for larger packaging to preserve profit margins.

The group added that grocery retailers regularly review inventory levels, pack sizes and product mixes based on local demographic characteristics to better align with consumers’ purchasing capacity, even as national retail chains continue to expand.

The USDA report noted that the Philippines remains the leading US consumer-oriented export market in Southeast Asia, which could allow US-based exporters to expand their product range in the country.

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