Malacañang yesterday said the tariff reduction on rice is aimed at addressing a 10- percent shortfall this year and at keeping inflation rates down.
This developed as Senators Kiko Pangilinan, Frank Drilon, Nancy Binay, Leila de Lima and Risa Hontiveros on Wednesday filed a resolution urging the President to withdraw Executive Order (EO) 135 that reduced the most-favored nation (MFN) tariff on rice to 35 percent for a year, from 50 percent. The senators cited data from the Philippine Statistics Authority which showed rice inflation rate from February to April this year has been in the negative territory.
Agricultural lobby group Samahang Industriya ng Agrikultura (SINAG) yesterday said in a statement government should allot a P205-billion support fund to procure palay at P17 per kilogram.
In a press briefing, presidential spokesman Harry Roque said there is enough supply of rice at present and good harvest is also expected this year.
Roque said importation is needed due to an expected 10-percent shortfall in supply.
He said there is no specific volume covered by the reduced tariff but assured there will be no importation during harvest season.
“This is to ensure the 10 percent that we will need, despite the bumper harvest this year, will be secured at a low price… which is why we slightly lowered the tariff because if prices go up, higher inflation will ensue,” he added.
Roque said the national government wants to avoid a repeat of the shortage in April 2020 after Vietnam and other rice-producing countries prioritized the rice security in their countries.
The resolution said the country’s rice self-sufficiency levels declined to 79.8 percent in 2019 from 86.2 percent in 2018 and 93.4 percent in 2017, after the Philippines have increased its dependence on imported supplies.
The senators said the lowering of tariff may negatively affect the Rice Competitiveness Enhancement Fund as its funds are dependent on the collection of taxes from imported rice.
Agricultural lobby group, Samahang Industriya ng Agrikultura (SINAG) said with EO 135, rice from India which is the cheapest would be priced at P24.28 per kg.
This would drag palay prices down to P12 per kg for wet and P15 per kg for dry.
Rosendo So, SINAG chairman, said at present, local millers are able to buy palay at P19 per kg for dry and P17 per kg for wet as Vietnamese and Thai rice, which comprise the bulk of our current imports are priced between P28 and P30 per kg.
“From June to December this year, SINAG projects around 11.5 metric tons of palay to be harvested. At P17.8 per kg support price, SINAG and Philcongrains (Philippine Confederation of Grains Associations) are asking the government, through the Senate, to cough up P205 billion to buy all the palay harvest, in lieu of the local millers which cannot compete anymore with the much incentivized imported rice under EO 135,” So said.
The National Movement for Food Sovereignty said the EO is unjustifiable.
“What is their basis to reduce the tariffs? If their concern is inflation, we know that rice is not the main driver for the high inflation rates in the past few months. And there is ample supply, there is no urgent need to augment supply,” said Manuel Rosario, a convenor of the group.
The group said in a statement.
continued dependence on rice imports “does not spell food security for our country” and is “detrimental to our local rice industry and our own food security.”
Based on data from the Department of Agriculture’s Bantay Presyo, as of yesterday (May 20), prevailing price of imported selections of special rice is at P52 per kg.; premium rice at P45 per kg; well-milled at P44 per kg as local selections of special rice is at P50 per kg; premium at P45 per kg; well-milled at P40 per kg.; and regular milled at P38 per kg. – Jed Macapagal
