It was in 2018 that market prices – inflation in economic terms – rose to a peak of 6.7 percent in October, after steadily rising throughout the year. High rice prices were seen as a major cause of the inflation, rice constituting a big major part of the Filipino diet.
As Congress met on this problem, market prices slowly settled down after October. The rice Tariffication Law was approved in November, transmitted to Malacañang in January, and signed by the President into law. It ended all previous quantitative restrictions on rice importation and allowed the private sector to import unlimited quantities after payment of tariff – 35 percent for rice from fellow ASEAN nations and 50 percent for non-ASEAN imports.
As big volumes of rice arrived, market prices settled down. But the huge imports hit local farmers who, with their high production costs, could not compete with the cheap foreign rice. It is now harvest time in the Philippines and our rice farmers are now facing the old problem posed by cheap imports.
Early this week, Sen. Cynthia Villar urged agencies of the Department of Agriculture not to allow the importation of rice, corn, and other agricultural products during the harvest season to avoid oversupply resulting in the decline of farm gate prices.
Speaking at the Senate hearing on the Department of Agriculture’s R86.3-billion budget for 2021, she sought support for her motion to halt rice importation during the ongoing harvests to stop plummeting palay prices. Secretary of Agriculture William Dar supported the move and asked the Senate to formalize the call with a resolution.
We are now in the midst of the harvest season for rice, corn, and other farm products in the Philippines. This is the time our farmers hope to recover their investments in the crops they planted earlier this year. Low market prices are welcomed by consumers, but too-low farm prices hurt our farmers, in the face of competition from cheap rice from Vietnam and Thailand.
The problem can best be met by helping our rice farmers lower their costs of production through free irrigation, use of high-yielding varieties of rice, scientific farm practices, and marketing assistance. This may take time, as these require considerable funds which the Department of Agriculture does not have. Agriculture has not received as much funding as other sectors of the economy in the government’s budget allocations.
Senator Villar’s call for a ban on rice imports during the ongoing harvest season is just a temporary solution but it will be a big help to our rice farmers. It will have to do until the Department of Agriculture and our farmers, particularly rice farmer, get the budget assistance they need.