Rice imports seen declining due to higher production
THE Philippines would reduce its purchases of imported rice due to higher output this year, the United States Department of Agriculture (USDA) said in its latest report.
In its monthly report, the USDA revised downward its import forecast for the Philippines for marketing year (MY) 2020/2021 to 2 million metric tons (MMT) from the previous estimate of 2.2 MMT.
“Global rice production is forecast slightly lower this month primarily on decreased production in Burma, Indonesia, and Taiwan more than offsetting higher production in the Philippines and Thailand,” the USDA said.
The Philippines imported about 2.45 MMT of rice last year, according to the USDA.
The Philippines became the largest buyer of rice in 2019 after it enacted a law that deregulated its rice industry and eased restrictions on imports.
The Philippine Department of Agriculture (DA) said is targeting to increase unhusked rice output to a record high of 20.4 MMT from last year’s 19.44 MMT.
If the production target is realized, the country will achieve a 95 percent self-sufficiency level in rice, according to the DA.
The DA had earlier filed a petition before the Tariff Commission to reduce the most favored nation (MFN) rates on rice imports to 35 percent from the current 40 percent (in-quota) and 50 percent (out-quota) levels.
The tariff reduction measure is supported by the Department of Finance. The DA and the DOF said the reduction in tariff would expand the source of cheap rice for the Philippines amid the increase in the prices of the staple from Thailand and Vietnam.
The DA and the DOF are looking at South Asian countries as alternative suppliers to the country’s staple supply. The DOF noted that rice export prices in India are now 30 percent cheaper than those sold by Vietnam and Thailand.
At least 90 percent of the country’s rice imports come from Vietnam and Thailand.