Philippine F&B retail sales growth seen flat
The Philippines’ food and beverage retail sales growth are projected to be relatively flat in 2026 as weakening household consumption and rising living costs constrain consumer spending.
The US Department of Agriculture’s Foreign Agricultural Service (USDA-FAS) said local retail food and beverage sales are estimated to reach $123 billion in 2026, representing a 1.7 percent uptick.
However, grocery retail sales are seen to drop by 3.2 percent to $61 billion for this year.
The foreign agency said that economic slowdown in the second quarter of 2026 has softened household consumption and prompted consumers to adopt price-sensitive, value-seeking consumer behavior.
This shift “could further pressure discretionary and premium or imported product segments,” the USDA-FAS said in its Retail Foods Annual report.
Although the report said the Philippines’ gross domestic product is expected to grow by 4 percent this year due to sustained growth in manufacturing and services, these factors could weigh on the country’s economic growth.
“However, rising transportation and energy costs, elevated inflation and weaker overseas remittances could curb domestic consumption and pressure overall economic growth,” it said.
Citing information from the Philippine Amalgamated Supermarkets Association, the USDA-FAS said retailers have introduced smaller, budget-friendly packaging options at accessible price points while increasing prices of larger pack sizes to help protect margins.
The foreign agency said consumers are opting for cost-effective alternatives and focusing on essentials, while others prioritize value over volume.
Although consumers prioritized essential products, the report noted that food and nonalcoholic beverages remain the single largest component of household spending, comprising 36 percent of total consumption.
Despite a sluggish growth forecast for 2026, the USDA-FAS said overall retail and grocery sales will hit $129 billion and $61 billion, respectively.
