Palay output goal of 20M MT deemed insufficient to satisfy growing demand

FARMERS said that the current target for palay or unmilled rice production is not ambitious enough to meet growing demand for rice, signaling that the government is planning to address shortages with more imports.

“A 20-million-ton output will not even be enough to satisfy the increase in demand, and our deficit and reliance on imports will actually increase,” Federation of Free Farmers National Manager Raul Q. Montemayor said in a Viber message.

The national daily consumption rate for rice is equivalent to 679,670 bags or 33,983.5 metric tons (MT), according to the National Food Authority.

On Monday, the Department of Agriculture (DA) said it wants production to be no less than 20 million MT, equivalent to the previous year’s target.

The DA has said that it is expecting 500,000 MT of imported rice to arrive as the government builds up reserves in preparation for the worst of El Niño.

To bring down the prices of imports, the government also extended the lowered tariffs on rice via Executive Order No. 50. Rates for rice imports were kept at 35%, regardless of the minimum access volume and country of origin.

“We are about the same or higher than last year. So, 20 million MT is not impossible but (will depend on) timing of irrigation and early planting,” former Agriculture Undersecretary Fermin D. Adriano said in a Viber message.

Last year, the DA similarly projected that palay production would hit 20 million MT due to the increase in land area planted to rice.

“If the El Niño results is delayed or we receive reduced rainfall in the second quarter, it will reduce available water in dams for irrigation and prevent or delay planting in rainfed areas,” Mr. Montemayor said.

Separately, Samahang Industriya ng Agrikultura Executive Director Jayson H. Cainglet said that dry spells occurring in Nueva Ecija would pose a risk to production as the province accounts for 3-5% of national output.

“If Nueva Ecija experiences dry spells, this would have a big impact on production, because (the province) is a major rice producing area,” he said in a Viber message.

The government weather service, known as PAGASA (Philippine Atmospheric, Geophysical and Astronomical Services Administration), has said that El Niño’s intense phase could run until the second quarter and bring droughts or dry spells to 63 provinces.

Meanwhile, Mr. Montemayor said that wet season harvest starts in May, running until late September or November, and may be vulnerable to El Niño as well.

“This wet season crop will be the most vulnerable to El Niño and we could again experience tight supply and price spikes in August and September like last year if supplemental imports do not come in,” he added.

A surge in the price of rice in Philippine markets prompted the government to implement price controls last year.

Executive Order No. 39, capped rice prices at P41 per kilogram (kg) for regular-milled rice and P45 per kg for well-milled rice. Price controls ran from Sept. 5 to Oct. 4, 2023.

President Ferdinand R. Marcos, Jr., who was the agriculture secretary at the time, cited hoarding and price manipulation as behind the higher prices.