Despite the declining prices of locally produced palay, the Philippine government agencies are in full force to defend the Rice Tariffication Law (RTL), which allowed the unlimited entry of cheaper imported rice in the country.
On Thursday (Oct. 8), four government agencies – the Department of Agriculture (DA), National Economic and Development Authority (NEDA), Department of Finance (DOF), and Department of Trade and Industry (DTI) – conducted a virtual webinar about RTL and asked for public understanding about the “short-term” effects of the law, including the decline in the price of palay.
The government-led webinar about the RTL was also attended by hundreds of rice stakeholders and experts.
Concerned officials, however, were not able to answer concerns of some farmers due to lack of time.
But representatives of concerned government agencies at the webinar, including Agriculture Secretary William Dar, Trade Undersecretary Ruth Castello, Acting Socioeconomic Planning Secretary Karl Kendrick Chua, and Finance Assistance Secretary Antonio Lambino 2nd – has one key message: the law is working but it will still take time to realize its full benefits to the farmers and entire rice industry.
Chua, for his part, said RTL is a “game changer” and “pro-consumer,” stressing that while the large volume of imported rice that entered the country last year resulted in the decline of the price of palay, “farm-gate prices have quickly recovered.”
The decline in prices, he said, is just one of the “short-term effects of the reform” and that without the law, things could be worse for poor families during the pandemic as they will have to be exposed to expensive rice.
“The law is also expected to accelerate agriculture growth and facilitate the structural transformation of the economy with GDP increasing by at least 0.13 percent in 2025,” Chua further said, citing a study made by NEDA and International Food Policy and Research Institute (IFRI).
Based on data from NEDA, the average retail price for regular milled rice (RMR) from January to August this year now stood at P37.05 per kilogram (/kg), slightly lower compared to the annual price level of P37.89/kg last year and P40.75/kg in 2018, which is the year before RTL was passed.
However, the data also showed that in 2016, the price of RMR is much lower at P36.67/kg, while it is P37.15/kg in 2017. These are years before RTL was passed.
For his part, Dar said RTL, through the Rice Competitiveness Enhancement Fund (RCEF), the collection of rice import tariff, already had “emerging outcomes”, including the increase in palay production last year and the increase in the average yield of rice farmers who already benefited from RCEF through the provision of free high quality seeds.
To address the declining price of palay, he reiterated that the National Food Authority (NFA) to “proactively buy, mill, sell, and rollover” locally produced palay to address the declining price.
The virtual public seminar, according to DA Spokesperson Noel Reyes, gathered as many as 500 experts and stakeholders in the rice industry.
In the webinar’s chat options, numerous stakeholders, some of which are farmers and from different local government units (LGU), filed their questions and concerns about RTL on hopes that government officials and the webinar’s speakers could enlighten them.
A certain Nanette Geronimo from the LGU of Calapan City, for instance, lamented the disparity of retail cost of rice versus the farmgate price of palay, which was not addressed in the webinar.
“It is sad that the price of palay during this harvest season is P13.50/kg, while the price of rice in the market is P1,100 per 25 kg. Farmers are losing. They weren’t able to take back what they spent in planting,” Geronimo said.
A certain Joel Bernasor agreed with Geronimo, and added that some cooperatives in Mindanao are already refusing to lend to rice farmers because they know farmers wouldn’t make money if they’ll use it to produce rice. This concern, too, wasn’t addressed.
Jofti Villena of Social Watch Philippines also pointed out that the reason farmers are having a hard time now is the high cost of producing palay, which stood at P12/kg.
She thought it is dismissive of one webinar’s speakers, Emil Javier, to say that farmers shouldn’t be given free seeds and instead be provided with loans and insurance.
“This is a one-sided orchestrated propaganda of the DA. You are presenting only one side of the story. You will not solve the problems of the sector and RTL if you only listen to yourselves,” Raul Montemayor, national manager of Federation of Free Farmers (FFF), said.
Meanwhile, Business Bulletin also asked the webinar’s speakers when do they see the retail cost of rice falling below P30/kg or at least near the P27/kg price of NFA rice that the government stopped selling due to the implementation of RTL. This wasn’t answered as well.
Based on the government's earlier computation, the retail prices of rice will go down by P7/kg once rice tariffication happens.
However, based on the latest data from the Philippine Statistics Authority (PSA) the average retail price of well milled rice stood at P42.24/kg during the second week of September, even going up by 0.02 percent from its price level of P42.23/kg during the same period last year, or six months since the RTL was passed.
As for the retail price of regular milled rice, price stood at P37.89/kg, increasing by 0.1 percent from last year's price level of P37.84/kg.
This is still nowhere near the P27/kg NFA rice that the government stopped selling after the RTL was passed.