The Rice Industry Development office of the Department of Agriculture (DA) said the onset of harvest in Nueva Ecija earlier this month had been showing declining trends in palay farm gate prices.
This developed as the Department of Finance (DOF) pitched several measures to ensure sufficient rice supply at reduced prices, as well as those that will address the negative impact of the implemented rice price ceiling.
Leo Sebastian, DA undersecretary, yesterday said prices may drop further when harvest peaks in late September and October.
Sebastian said based on a field survey done by the National Rice Program in several towns of Nueva Ecija last week, prices of fresh palay have gone down to P17 and P18 per kilogram (kg)
He said farmers predict prices may falls to P15 to P16 per kg when harvest for the wet season crops begins to peak by mid-September.
These prices are from a high of P22 to P25 per kg in June and July, at a time when farmers were appealing for government intervention to get better rates for their produce and not be at the mercy of prices to be dictated by the traders, agents and millers.
Farmers lament local production had been substantially decimated by the recent prolonged downpour caused by typhoons and the southwest monsoon, resulting in many of standing crops bending to the soil, making them irrecoverable.
DA’s National Rice Program inspection showed among those heavily affected by the prolonged downpour were the farms of Licab, Quezon, Zaragoza and other areas.
The Department of Trade and Industry (DTI) noted the need to address the issues on rice prices on the farm level hand in hand with all forms assistance to consumers and traders.
DTI Secretary Alfredo Pascual said the agency will continue helping increase rice production through the distribution of seeds and fertilizer as this would ultimately improve farmers’ incomes while bringing down the cost of the grain.
Meanwhile, the DOF has proposed the following measures to ensure supply and prices of rice are stable: reduction of the 35 percent rice import tariff rates, both Asean and most-favored nation rates, temporarily to zero percent or maximum of 10 percent to arrest the surge in rice prices; encouraging the timely importation of rice by the private sector; full implementation of the Super Green Lane that authorizes the use of Electronic Data Interchange that will allow for the advance processing and clearance of the shipments of the country’s topmost qualified importers; and cooperation with tollway concessionaires and operators for the temporary exemption of trucks that cater to agricultural goods from the increase in toll fees.
“There is also a need to curb non-competitive behavior in the rice industry by aggressively pursuing cases of hoarding, smuggling and economic sabotage; strictly monitoring the prices of imported rice in the logistics chain; and encouraging the public, including retailers, to report individuals violating price caps on rice,” finance secretary Benjamin Diokno said in a press briefing last Friday.
“We have to pursue programs to protect vulnerable sectors by safeguarding our farmers from the effect of the price ceiling; provide targeted subsidies to small traders and retailers of rice; and provide support to low-income households to address the impact of the surge in rice prices,” he added.
Malacanang recently issued executive order no. 39 which slapped mandated price ceilings on regular milled and well-milled rice, at P41 and P45 per kilogram, respectively.
During the briefing, Diokno admitted the issuance of the order came as a surprise to him, as well as to National Economic and Development Authority (NEDA) secretary Arsenio Balisacan, as the announcement was made while the economic team was overseas discussing Philippine investment opportunities to the Japanese government and potential investors.
While Diokno believes price controls, when “carefully calibrated and closely implemented,” are effective in the near-term, he said government recognizes that it also has adverse effects if allowed to linger for a longer period.
“ Number one, the farmers won’t plant. Secondly, the importers wont import, and of course, there’s a strong likelihood that supply will disappear, because if you’re losing money, you just close your shop,” he added.
By” near-term,” Diokno said he means when the conditions that led to the imposition of price ceilings no longer exist.
“For example, if hoarders have been apprehended, and if there is a harvest or if importation is already underway. (Farmers) have now started to harvest in Mindanao, and within two weeks, it will be the harvest season for Q4. There are importations coming in soon. I would say, given these conditions, it might take around one month.”
Rice tariffs
The Foundation for Economic Freedom (FEF) has appealed to the Tariff Commission to lower the existing 35 percent tariff on imported rice to 10 percent to resolve the current demand-supply gap for rice, address food inflation and ease the rice prices that affects consumers.
“The protectionist 35 percent rice import tariff is the most significant driver of the cost of imported rice. A back-of-the-envelope calculation suggests that duty-free importation of rice, even at $600 per ton, should bring the landed cost of imported rice at parity with wholesale well-milled rice of P39 per kg, which is consistent with a retail price of P45 per kg the current well-milled rice price ceiling,” the group said.
The Kilusang Magbubukid ng Pilipinas (KMP) said the worsening global rice price and supply situation must force the government to give priority to and strengthen the domestic rice industry.
“We do not see the rice situation easing in the next months, based on global and local indicators. All sectors of society, especially those feeling the brunt of incessant rice and food price hikes should assert for the junking of the Rice Liberalization Law and the reinstatement of state regulation and control over the rice industry,” Ronnie Manalo, KMP secretary general, said in a statement.
KMP said based on the Food and Agriculture Organization’s monthly all rice price index, global rice prices increased by near 10 percent in August to reach a nominal 15-year high which was aggravated by the trade disruptions due to India’s decision to ban exports of non-basmati rice in July.
Rice on wheels
The DTI said it will also officially roll out today the Rice on Wheels Program after its dry run last Saturday which was simultaneous with the start of the disbursement of financial aid to rice retailers affected by the price caps on the grain.
In his speech at the distribution of financial assistance to rice retailers in Agora Market, San Juan City, Pascual vowed to speed up the distribution of the assistance to other parts of the country.
Through the Sustainable Livelihood Program (Cash Assistance for Micro Retailers), the Department of Social Welfare and Development will give P15,000 to retailers affected by EO 39. The initial rollout also covered public markets in Caloocan City and Quezon City.
Also last Saturday, the DTI in coordination with Bulacan Rice Millers and Traders launched its rice caravan in Novaliches, Quezon City to ensure the availability of affordable regular and well-milled rice to the general public. Through this caravan, the DTI targets to supply retailers in the public market with affordable rice stock.
“The DTI will work closely with different government agencies and private stakeholders to ensure that Filipino families will be able to access affordable rice during the implementation of Executive Order No. 39. We will continue to find ways and means to work with the private sector to stabilize the supply and price of rice in the market.
Some public markets lin Makati, Parañaque and Manila City were also covered by the dry run.
Monitoring
Based on monitoring by the DA on public markets in the National Capital Region as of Friday, the price of local well-milled rice is at P45 per kg; and regular milled ranging between P40 to P52 per kg.
The price of imported well milled rice is also at P45 per kg and regular milled, P41 to P45 per kg.
Imported rice ranged from P53 to P65 for special variety and P55 to P58 for premium.
For local rice, special variety was at P54 to P65 per kg and premium at P49 to P60 per kg. Angela Celis and Irma Isip
