PH needs imported rice despite abundance in local supply - PhilRice

March 02, 2018

PH needs imported rice despite abundance in local supply – PhilRice

Published March 2, 2018, 10:00 PM
By Madelaine B. Miraflor

Manila Bulletin

A few days after it backed the Department of Agriculture (DA) for saying there’s abundance of rice supply in the country, the Philippine Rice Research Institute (PhilRice) came out with a statement arguing that there is still a need for rice importation.

As if it forgot to specify this on the same day it came out with a statement that it sees no rice shortage in the country, PhilRice is now emphasizing the importance of importation.

Flordeliza Bordey, an economist and the Deputy Executive Director for Research of PhilRice, said that despite the availability of supply, the country still needs to import rice to stabilize prices in the market.

“We have to understand that rice production in the country is seasonal. Our production peaks during the last quarter of the year, while our consumption barely changes over the months.  Our stocks dwindle as we enter the lean months from July to September. Without comfortable level of stocks, there is a tendency for price of rice to spike. This is where importation can help,” Bordey said.

“It can help us manage the supply and demand for rice, and avoid sudden, unexpected increase in its price,” she added.

Following the trend over the years, the country produces 23 percent of its total rice production in the first quarter of the year, 21 percent in the second, 16 percent in the third, and 40 percent in the fourth.

Bordey also cited the changes in the government policies regarding international rice trade.

In the Philippines’ commitment to the World Trade Organization and ASEAN Free Trade Agreement, the government’s power to set quantitative restriction on rice imports must be replaced with tariff.

“This new trade regime allows the entry of cheap imported rice in the Philippines provided that the required tariff is paid. Unfortunately, even with 35 percent tariff rate, Philippine rice is still more expensive than the imported ones from our ASEAN neighbors such as Thailand and Vietnam,” Bordey said.

In a study of Bordey’s team, the landed cost of imported rice from Vietnam with 25 percent broken grains is only around P27 per kilogram (/kg) including the tariff.

It is a lot cheaper than the rice produced here in the country, which are sold at around P40/kg at the retail.

The big price difference and potential profit can attract merchants to bring-in more rice imports. The only way our local rice can compete is to lower its cost and we can only do that if we enhance the competitiveness of our farmers, Bordey explained.

Bordey said this situation is the main reason PhilRice and the DA push rice security. Hence, experts recommended ways on how farmers can make our locally-produced rice competitive.

“The key strategy is for our farmers to increase their yield per hectare and decrease their cost in farm production. Planting hybrid and certified inbred seeds with appropriate crop management practices can help achieve high yield. Meanwhile mechanizing farm processes and using other labor-saving technologies can lower the production cost. High labor cost spells the difference in the farm production cost of Vietnam and the Philippines, hence the importance of lowering it,” Bordey said.

Tags: Department of Agriculture, farm production, Flordeliza Bordey, international rice, PH needs imported rice despite abundance in local supply – PhilRice, PhilRice, Rice Importation, rice production