Proposed rice sale to poor contradicts RTL – farmers

Published May 26, 2022, 5:56 PM

by Bernie Cahiles-Magkilat

The Federation of Free Farmers (FFF) cautioned the Department of Agriculture (DA) against unilaterally selling rice buffer stocks to poor consumers, as this contradicts the Rice Tariffication Law (RTL), which lifts the volume ceiling in rice importation and replacing it with high tariff wall.

FFW said in a statement that under the plan broached recently by DA Secretary William Dar, private retailers will be mobilized to sell rice stocks of the National Food Authority (NFA) at P27 per kilo primarily to beneficiaries of the government’s Pantawid Pamilyang Pilipino Program (4Ps).

The FFF clarified that, under the RTL, the NFA’s buffer stocks can be used only “for emergency situations and to sustain the disaster relief programs of the government during natural or man-made calamities”. The implementing rules of the RTL also allow the agency to unload additional stocks, but only if these are aging or about to deteriorate.

“The DA and NFA will be violating the law if they pursue their proposal without the justifications stipulated by the RTL. We must remember that the law took away NFA’s original mandate to stabilize or influence rice prices and limited the agency’s role to maintaining buffer stocks for emergencies. The law has to be amended first before NFA can start selling subsidized rice again to consumers.”, said Raul Montemayor, FFF National Manager.

The FFF, in a statement, also questioned the need for the proposed scheme in the light of claims by the country’s economic managers that the RTL was successful in bringing down the prices of rice.

“The RTL’s proponentspromised that rice prices would go down if we allow imports to come in freely without any restriction and competition from the government. Why are they now proposing to bring back NFA rice?”, said Montemayor.

The FFF added that the NFA would lose at least P11.60 for every kilo of rice sold at P27 per kilo, if it buys palay from farmers at P19 per kilo. “This loss does not yet include the NFA’s processing, marketing and overhead costs,” added Montemayor.

With that, the FFF urged President-elect Bongbong Marcos to immediately call for the review and amendment of the RTL in order to remove legal impediments to providing cheaper rice to poor consumers while protecting farmers from excessive imports and rising fertilizer and other production costs.

Another option to help the poor sector is for the incoming administration to look into the feasibility of increasing the cash transfers to 4Ps beneficiaries instead of distributing rice to poor consumers.

This would free the government from logistical headaches and the corruption and leakages that have hounded similar programs in the past.

The FFF added that selling NFA rice at a very cheap price could inadvertently depress farmgate prices, which will in turn force government to again allocate scarce resources to prop up palay prices through NFA buying.