Open rice im­por­ta­tion fa­vors big firms

Manila Bulletin - - Front Page - By MADELAINE B. MIRAFLOR

The “unim­peded” rice im­por­ta­tion or­der of Pres­i­dent Ro­drigo Duterte did not only prompt an al­ter­ca­tion be­tween Fi­nance Sec­re­tary Car­los Dominguez III and Agri­cul­ture Sec­re­tary Em­manuel Piñol but also fu­eled con­cerns that it could neg­a­tively im­pact lo­cal farm­ers and the coun­try's do­mes­tic out­put.

Such or­der, a cou­ple of non-govern­ment or­ga­ni­za­tions (NGOs) agreed, will only ben­e­fit com­pa­nies like San Miguel Corp. (SMC) and AgriNur­ture, Inc. (ANI), which have openly ex­pressed their in­ter­est to im­port rice.

In a state­ment, the Na­tional Move­ment for Food Sovereignty (NMFS) and the In­te­grated Ru­ral De­vel­op­ment Foun­da­tion (IRDF) raised con­cern over Duterte's sud­den procla­ma­tion on al­low­ing free im­por­ta­tion of rice de­spite the fact that the bill al­low­ing the tar­if­fi­ca­tion of rice is still pend­ing in the Se­nate.

Dur­ing a Cabi­net meet­ing on Mon­day, Duterte or­dered to put an end to re­stric­tions on rice im­ports sup­pos­edly as a mea­sure to ease the soar­ing in­fla­tion, which re­cently surged to its fastest level in nearly a decade.

NMFS and IRDF said in a joint state­ment that Duterte’s re­cent di­rec­tive spells doom for more than three mil­lion rice farm­ers, while it sup­ports the plan of big com­pa­nies such as SMC and rice car­tels to con­duct "mega rice im­port trans­ac­tions."

The groups have claimed that rice farm­ers are al­ready suf­fer­ing from higher pro­duc­tion costs due to Tax Re­form for Ac­cel­er­a­tion and In­clu­sion (TRAIN) law and the ris­ing fuel cost.

In 2017, a data from the Philip­pine Sta­tis­tics Au­thor­ity (PSA) showed that net re­turns from palay farm­ing stand only at only 125,193 and 121,743 dur­ing the dry and wet sea­son re­spec­tively or a to­tal of 146,936.00 an­nu­ally.

This could be fur­ther low­ered once the coun­try lib­er­al­ized rice im­por­ta­tion through the pas­sage of Agri­cul­ture Tar­if­fi­ca­tion Act.

Based on the pro­jec­tion of Philip­pine In­sti­tute for De­vel­op­ment Stud­ies (PIDS), the im­pact of rice tar­if­fi­ca­tion could re­duce a farmer's an­nual rice in­come to 133,325.00.

"The pro­posed scheme for cash trans­fer/de­cou­pled pay­ment to farm­ers in the event of tar­if­fi­ca­tion of 19,500 per hectare will not even com­pen­sate for this loss," the joint state­ment reads.

Right now, since most farm­ers are highly in­debted and are de­pen­dent on traders and fi­nanciers for their pro­duc­tion cap­i­tal, fur­ther re­duc­tion in their in­comes would re­sult to in­creased in­debt­ed­ness that could lead to mort­gag­ing, sell­ing, and con­ver­sion of farm­lands.

"Most of our farm­ers are age­ing and lack the skills and ed­u­ca­tion that could en­able them to shift eas­ily from farm­ing to other oc­cu­pa­tion. The Pres­i­dent’s call for free im­por­ta­tion thus spells death to the liveli­hoods of al­ready im­pov­er­ished small-scale rice farm­ers," NMFS and IRDF fur­ther said.

On the longer term, it is also feared that rice tar­if­fi­ca­tion may in­duce re­duc­tion in do­mes­tic rice out­put that could trig­ger fur­ther rice price in­creases, es­pe­cially when sup­ply tight­ens.

"Our coun­try could not rely on the in­ter­na­tional mar­ket for our food se­cu­rity, since in­ter­na­tional rice trade ac­counts for only 5 per­cent-6 per­cent of global rice pro­duc­tion. More­over, in­ter­na­tional rice prices have been in­creas­ing steadily in re­cent years sug­gest­ing that fac­tors such as spec­u­la­tion that led to the un­prece­dented food price in­creases in 2008 to 2009 still per­sist," NMFS and IRDF fur­ther said.

Food and Agri­cul­ture Or­ga­ni­za­tion rice price up­date shows that in­ter­na­tional rice prices from 2017 (Jan­uary to Septem­ber) to 2018 (Jan­uary to Septem­ber) jumped from $366 per met­ric ton (MT) to $417 per MT for Viet­nam's five per­cent bro­ken rice, sug­gest­ing a 13.7 per­cent in­crease.

The state­ment of NMFS and IRDF are in line with the stand of Piñol, who thinks the coun­try can't rely on im­por­ta­tion to sup­ply the grow­ing de­mand for rice.

For his part, Dominguez said that rice tar­if­fi­ca­tion and re­forms in food pol­icy are needed to ad­dress the re­peated rice sup­ply prob­lems.

The rice tar­if­fi­ca­tion bill, once passed into law, is ex­pected to lib­er­al­ize the im­por­ta­tion of rice in the coun­try by im­pos­ing a cor­re­spond­ing tar­iff rate of 35 per­cent.

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