PHL RICE IMPORTS TO HIT 2.6 MMT–U.S.D.A.
THE opening up of the Philippine rice market could push its imports this year to a record-high 2.6 million (MMT) metric tons, making it the secondbiggest buyer of the staple since the 2008 rice price crisis, according to the United States Department of Agriculture (USDA).
In its monthly grains report, the USDA projected that rice exports to the Philippines would expand by 4 percent to 2.6 MMT, from the estimated volume of 2.5 MMT in 2018.
The USDA also revised upward its February forecast for Philippine rice imports in 2019 from 2.3 MMT to 2.6 MMT.
The USDA attributed the hike in imports to the implementation of the rice trade liberalization (RTL) law, paving the way for a new trade regime for the Philippines.
Under the RTL law, importers would just have to secure a sanitary and phytosanitary import-clearance (SPS-IC) from the Bureau of Plant and Industry prior to shipment arrivals. The law also deregulated the National Food Authority (NFA), removing all its power over rice trade in the country.
“As a result of this legislation, higher rice imports are expected from nearby Association of Southeast Asian Nations membercountries, with their relative low cost and preferential access to the Philippines,” the USDA said in the report, published over the weekend.
“[The 2.6-million metric ton import volume] is a record not seen since the international price spike in 2008 and would make the Philippines the second-largest global importer in 2019,” it added.
Government data submitted to the World Trade Organization indicated that this could be the biggest volume of rice to be imported by the Philippines in history, overshadowing the volume it purchased in 2008.
In 2008, the Philippines imported 2.39 MMT of rice, with 2.297 MMT of the total volume being bought by the NFA; while in 2010, the country purchased 2.369 MMT.
Despite the anticipated increase in imports, the USDA maintained its rice output forecast for the Philippines at 12.15 MMT, slightly lower than last year’s 12.235 MMT.
In a separate report, the United nations Food and Agriculture Organization (FAO) noted that global rice prices continued to decline despite the liberalization of the country’s rice industry.
“February quotations of Indica white rice declined across much of Asia, as fresh demand remained persistently thin, overshadowing news of the passage of the rice tariffication law in the
Philippines,” FAO said in its monthly rice market monitor report published recently.
FAO’s higher quality Indica rice index in February fell by 4.7 percent to 191, from 200 in January. Likewise, lower quality Indica index declined by 7.2 percent to 194 from 209 in the previous month, FAO data showed.
Quotations for 5-percent brokens of Vietnamese rice fell for the third straight month to $335 per MT, while its 25-percent brokens declined further to $323 per MT, FAO data showed.
“According to the Index, international prices in the first two months of 2019 were 1.1 percent below their levels in the corresponding period of 2018,” FAO said.