Despite recent denials from farmer groups, the Department of Agriculture (DA) insists that the Rice Tariffication Law (RTL) has allowed more rice grades to be available and affordable in the local market.
“The rice market segmentation is a very important outcome of the RTL with regards to rice prices. It only means that consumers have a choice depending on their preference and what they can afford,” William Dar, agriculture secretary, said in a statement.
Dar said because of RTL, the lowest price segment of rice now ranges from P27 to P32 per kilogram, while middle level rice grades are sold at P33 to P37 per kg. Special types of rice now retail at more than P38 per kg.
Dar said such development has made rice no longer a driver of inflation based on the January 2020 Consumer Price Index report by the Philippine Statistics Authority (PSA).
He added that as of second week of February, the average wholesale price of regular milled rice (RMR) was at P33 per kg., 13 percent lower than the P38 per kg. a year ago. At the retail markets, RMR is sold at P36.33 per kg., down 11.6 percent from P41.11 in 2019.
Average wholesale price of well-milled rice (WMR) also dropped 10.6 percent to P37.06 per kg., from P41.45 per kg. during the same period in 2019. At the retail markets, WMR is sold at P41.22 per kg., 8 percent lower than P44.80 per kg. in 2019.
Dar mentioned that efforts to further improve palay productivity and reduce production costs are continuing to ensure profitability of rice farmers despite the dropping costs of palay and rice.
He said the National Food Authority (NFA) will also be aggressive in buying palay from farmers at the current support price of P19 per kg. during the dry season harvest, which is higher than the prevailing average farmgate price of palay at P16 per kg.
Last year, NFA bought P14.5 billion worth of palay, rolling twice its annual subsidy of P7 billion. For 2020, P4.9 billion has been allotted for palay procurement during the dry season and another P9.7 billion for main harvest season.
Last week, the Federation of Free Farmers said the desired effects of the RTL are not yet felt by consumers as the drop in rice prices last year is still not enough to match 2016 and 2017 price levels.
Citing data from the PSA, the group said the DA and Department of Finance’s claim that rice prices have dropped by P9 per kilo mainly due to the RTL is quite unlikely, since 70 percent of the drop in both RMR and WMR prices occurred between September 2018 and March 2019, or before the RTL took effect.
