Despite declining volumes amid the global economic slump, revenues from rice imports surpassed the government’s full-year target in the first nine-months of the year, the Department of Finance (DOF) said.
In a statement, Finance Secretary Carlos G. Dominguez III said the Bureau of Customs collected P13.08 billion in rice duties from January to September, above the P10 billion target for the Rice Competitiveness Enhancement Fund (RCEF) for 2020.
Dominguez said the above RCEP target collection was owing to the Customs’ improved valuation system, which raised the rice tariff from P18,178 per metric ton to P27,120 per metric ton.
The finance chief also pointed the higher valuation for rice cushioned the unfavorable impact of the strengthening peso against US dollar.
In a meeting with Dominguez, Customs Commissioner Rey Leonardo Guerrero reported that the improved revenue was also the result of the agency’s “particular attention" to the classification, quantity and weight of the imports whenever rice shipments came in.
Guerrero said that for January to October 15, the average valuation of rice increased by 6.5 percent or P1,240 per metric ton.
Citing Customs data, Guerrero said that from an average valuation of P18,178.86 in January per metric ton of rice, this assessment rate increasingly improved to P18,753.82 per metric ton in March, to P20,503.07 in May and to P27,120 in September.
“The collections are down because the import volumes are also down, but the average valuation—the value over volume—started to improve,” Guerrero told Dominguez during the meeting.
As a result, Guerrero said the Customs was able to collect P1.29 billion in duties from 223,279 metric tons of rice imports in
January valued at P4.058 billion based on an average valuation of P18,178.86 per metric ton.
The agency then collected P1.19 billion from a much lower volume of 176,768 metric tons, but valued at P3.55 billion in August because the average value that month was increased to P20,100.54 per metric ton.
Guerrero pointed out that the computerized valuation system used by the Customs is compliant with World Trade Organization (WTO) standards.
Meanwhile, rice industry leaders, economic managers, and farmers' representatives affirmed the benefits of the year-old rice tariffication law (RTL) that led to cheaper staple food for consumers and higher yields for palay growers.
During a webinar, Agriculture Secretary William Dar, Acting Socioeconomic Planning Secretary Karl Kendrick Chua, Trade and Industry Undersecretary Ruth Castelo, and Finance Assistant Secretary Antonio Joselito Lambino II led the panel of experts from the government.
Representatives from various stakeholder groups also reacted to the presentations and discussed the effects of RTL or Republic Act (RA) No. 11203 on its first year of implementation.
Dar provided updates on the Rice Competitiveness Enhancement Fund (RCEF) and the support provided to rice farmers in their transition toward competitiveness.
“We have been working double-time since October 2019 to carry out the component programs on seed, mechanization, credit, and extension services that complement existing DA interventions,” Dar said.
Dar said that just one year into RTL’s implementation, these mechanisms have already yielded early gains for farmers in terms of higher yields per hectare.
Chua, meanwhile, presented the reform’s role in developing a productive and competitive rice sector. He also discussed the positive benefits of the law for consumers, especially low-income households in the country.
“Low rice prices help us achieve our poverty reduction goals. This is because rice consumption accounts for around 30 percent of the total food expenditure of the poor,” Chua said.
He noted that without the RTL in place during the COVID-19 crisis, socioeconomic outcomes for the vulnerable “would have been much worse.”
Castelo, on the other hand, outlined the efforts of the Department of Trade and Industry (DTI), in close coordination with the DA, to increase the accessibility and availability of rice in the market.
“Amid the increasing prices of other items in the Consumer Price Index (CPI) basket, prices of rice continued to ease due to oversupply of rice in the market,” she said, attributing the low prices of the staple to the RTL and the DTI’s Presyong Risonable Dapat! (PRD) program.
The PRD program allows retailers and importers with direct access to retail outlets to import rice and sell directly to retail stores, eliminating traders in between.
During the Department of Finance’s (DOF) presentation on public investment in agriculture, Lambino shared that the RTL has generated more than enough in tariff revenues to support the rice sector through the RCEF.
“In 2019 for example, our rice tariff collections reached P12.1 billion. The P2.1 billion excess revenues were allotted to Crop Diversification Program at Expanded Crop Insurance Program,” Lambino said.
Lambino added that the Bureau of Customs has already breached the 10 billion-peso mark in the first half of the year, ensuring that the RCEF is fully-funded with additional revenues for other productivity-enhancement programs.
Bangko Sentral ng Pilipinas (BSP) Monetary Board Member (MBM) Bruce Tolentino shared his insights on the role of rice in maintaining low inflation through the pandemic.
It was noted that since March 2019, there have been major improvements in rice inflation since the passage of the RTL.
“Rice inflation is no longer a major concern for our macroeconomic management,” Tolentino said as he presented the rice price trends from 2016 to 2020.