Palace can intervene over drastic changes in rice prices – DTI

Published April 29, 2019, 12:00 AM

by manilabulletin_admin

By Bernie Cahiles-Magkilat

President Rodrigo Duterte can intervene on drastic changes in prices of rice to ensure the interest of farmers and consumers as government implements a free-for-all rice importation on efforts to stabilize supply and bring down prices to P30 per kilo.

Trade and Industry Secretary Ramon M. Lopez
Trade and Industry Secretary Ramon M. Lopezlopez

This was stressed by Trade and Industry Secretary Ramon M. Lopez during a press conference to discuss the streamlined importation procedures and benefits of the liberalized regime under the Republic Act No. 11203 or the Rice Liberalization Act.

Lopez explained that there is no trigger price or volume level in the Implementing Rules and Regulation, but said that the IRR provides for the President to intervene if there are drastic movements in the price of rice, whether the change is on the low or the high side. The intervention is to protect either the farmers or consumers.

But, he said, this will still undergo monitoring of prices, but if there is doubt in the mechanism then that is the time that Malacanang can intervene. For instance, he said, if imported rice has reached P40 per kilo while prices before have already settled at P38 or lower. Higher prices could be due to possible collusion.

He explained that the intervention provision is there because the objective of the law is to bring in cheaper priced rice. The DTI sees rice to reach P30 a kilo or lower. At present, prices of rice hover around P32 and P34 up to P38 a kilo already.

“If prices have gone too low, that is another point of intervention because that could be a signal that farmers are already losing,” he said. He, however, said that the current set up has already removed the role of the National Food Authority over rice importation so it would be the importers who would decide if it is still viable to import or not.

There is no amount as to the amount of rice importation, he said. But the trade chief noted that local rice production already accounts for 95 percent of rice supply in the market and with lower cost of production this means farmers can sell more, easing out imports. If local supply improves to 97 percent, then supply from imports would be limited to only 3 percent. This is the basis that importers have to watch out for to ensure that it is still viable to import.