Wheat consumption across Asia is on the rise, driven by rapid urbanisation, increased income, and the westernisation of diets. Wheat is shifting from a secondary staple to a primary one in many areas, with increasing consumption of flour-based products like baked goods and noodles, and imports often needed to meet the escalating demand.
The Philippines is no exception to this trend, with wheat consumption set to rise by 6.2 per cent from 6.5 million metric tonne in the 2024/25 marketing year (July to June), to 6.9MMT in the current season. However, higher commodity prices amid the ongoing conflict in the Middle East are expected to moderate that trend in the 2026/27 marketing year, with an increase of just 2.2 per cent to 7.05MMT currently forecast by the United States Department of Agriculture’s Foreign Agricultural Service.
While wheat demand from the nation’s food and industrial sectors has been increasing, so too has the requirements of the burgeoning stockfeed sector, with the ratio remaining relatively static at around 55 per cent / 45 per cent, respectively, in recent years.
Food and industrial consumption are expected to increase by 5.6 per cent from 3.6MMT in 2024/25 to 3.8MMT in the current season and are forecast to rise by a further 2.6 per cent to 3.9MMT in the 2026/27 marketing year. The trend is being driven by the increasing demand for milling wheat used to produce bakery, noodle, and pasta products.
Although domestic prices of flour, bread and other bakery products, pasta, and cereals have risen, the FAS Manila bureau is forecasting milling wheat consumption to increase by 2.6 per cent in MY 2026/27, driven by continued population growth, rising household incomes, and dietary diversification. The projected rise has been tempered by the escalating price of imported wheat, which in turn has led to higher prices for flour-based products.
In January 2026, Philippine manufacturers agreed to the government’s request to hold the price of most basic food necessities, including wheat-based products such as bread and instant noodles, to help stabilise domestic food inflation. While absorbing the higher costs of raw materials, packaging, logistics, and toll packaging, the Department of Trade and Industry (DTI) agreed to review and validate any industry requests for price adjustments.
However, the escalation of hostilities in Iran has dramatically changed the playing field, with President Ferdinand R. Marcos Junior ordering concerned agencies to prevent price gouging on commodities, including oil and other basic goods, amid the conflict in the Middle East.
The DTI has warned that the ongoing crisis is driving up raw material, fuel, and logistics costs. These higher costs will eventually lead to price increases, not because of supply shortages, but due to higher raw material prices and rising logistics and electricity costs. The government is reportedly looking at measures such as suspending certain port and toll fees to help contain costs.
According to FAS, feed wheat consumption is expected to increase in 2026/27 amid growth in the poultry, aquaculture, and pet food industries, despite the slow hog recovery and a reduced price advantage over feed corn. Feed wheat remains as a viable substitute for feed corn, when global prices for feed wheat are favourable relative to feed corn and/or when local feed millers encounter quality concerns for locally produced corn, such as aflatoxin, grain damage and low test weight, encountered during wet harvests (June to October).
In the first half of the 2025 calendar year, feed wheat prices traded at a significant discount to corn, driving the substitution of wheat for corn in many rations. However, by the final quarter of the year, that discount had been completely eroded as domestic corn supplies came online. This pushed wheat to a small premium over corn, substantially reducing its advantage from an energy source perspective in local stockfeed formulations.
New technological tools have made feed formulation more flexible, according to local feed millers, enabling real-time adjustments to incorporate more feed wheat into poultry and swine diets when its price is more favourable than feed corn. Incorporation of targeted enzymes in ration formulations has also improved feed wheat digestibility, addressing legacy nutritional limitations and making it a more viable, cost-effective partial substitute for feed corn.
Like many of its regional neighbours, the Philippines’ tropical environment is not suitable for the commercial cultivation of wheat compared with other cropping options, such as rice and corn, and renders long-term storage extremely difficult. This makes the country totally reliant on imports to meet its rising domestic requirements.
Philippine wheat imports were 6.4MMT in the 2024/25 marketing year, and FAS expects them to increase by 15.6 per cent, or just over 1.0MMT to 7.4MMT in the current season. However, the Manila bureau of the FAS has reacted to the evolving global wheat price environment, reducing 2026/27 import projections by 5.4 per cent to 7.0MMT, in line with domestic demand projections. This opinion is not yet shared by their US-based colleagues at the USDA, who left the import projection unchanged at 7.6MMT in its April global supply and demand update.
According to Philippine customs data for the July to December 2025 period, wheat imports totalled 3.56MMT, up from 3.0MMT a year earlier. Australia enjoyed a total market share increase of seven percentage points to 51 per cent to 1.8MMT, a reflection of higher feed wheat demand from the stockfeed sector.
Conversely, the US remained the leading supplier of milling wheat, with a sector market share of 82 per cent in the first six months of the marketing year. Imports from the US totalled 1.4MMT, a five percentage-point decline to 39 per cent of the six-month program, compared to the previous corresponding period. Canada was the third-largest supplier with 220,000 metric tonne, a market share of 6 per cent, down from 9 per cent a year earlier.
The large import program in 2025/26 is expected to see closing stocks rise to 1.2MMT, 66 per cent or almost 500,000 metric tonne higher than those at the end of the 2024/25 season. This has given the Philippines the luxury of a stock buffer as it enters the 2026/27 marketing year, enabling it to better manage the effects of rising global wheat prices on domestic food inflation. Erosion of stock holdings is currently forecast to be 100,000 metric tonne across the season, closing out 2026/27 at 1.1MMT.
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Written by Peter McMeekin.
