Rice, a politicized crop

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BY EDGARDO J. ANGARA
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Friday, February 23, 2018
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FIVE hundred years ago, Ming Emperor Wan Mui Li (1573-1615) sent a special delegation to the Philippines who brought back kamote for Fujian farmers who were dying by the millions because of famine caused by severe drought.  Fujian survived the drought and millions were saved from death on account of that Filipino humanitarian aid.

In a reciprocal gesture in 2000, Prof. Yuan Long Ping, inventor, transferred the hybrid rice technology to the Philippines.  He said he’s just paying back that utang na loob (debt of gratitude) China owed the Philippines.

One must carefully monitor the rice situation and avoid sending mixed messages to the public that, on one hand, there is enough domestic production and supply and, on the other hand, repeated pronouncement of impending rice importation.

This mixed messaging is good news either way to the Binondo rice traders and to the rice exporting-countries such as Vietnam and India.  The Binondo rice traders are benefited by advance news of a shortfall in domestic production.  The rice-exporting countries are immensely delighted by news of the Philippines importation because Philippine purchase in the international rice market almost always drives up the price of rice.

Rice has played an interesting role in Philippine politics. Several incumbent Presidents were beaten by the opposition on the issue of rice shortage.

The National Food Authority Council (NFAC) through Cabinet Secretary Leoncio B. Evasco Jr., announced last Monday that the NFAC has greenlighted the NFA’s purchase of 250,000 metric tons (MT) of imported rice via “government-to-private” (G2P) scheme.   Earlier on, the National Economic and Development Authority (NEDA), Department of Finance and the Bangko Sentral ng Pilipinas thumbed down the proposal of DA Secretary Piñol to increase the buying price of palay to 18 to 20 peso from the current P17 per kg.   The reason the economic managers rejected the increase of the buying price of palay was its resulting higher inflation.

Then as now the message is indeed important.

What can the President and Congress do — and must.

Under a reformist Duterte presidency, the chances of getting the NFA’s role redefined and the support to agriculture redirected, are much greater.

First, NFA should be limited to being a regulatory agency, not at all engaged in importation of rice or fixing of buying price of palay.   Limiting NFA to a regulatory body means NFA’s sole authority is to issue license and permits to rice outlets selling imported rice to the local market, whether through “government-to-government” or government-to-private sector” arrangement.   It means that there will be no cap on the buying price of paddy palay to prevent private traders from buying ahead of NFA at a higher price.   That’s what is actually happening today and that is the reason why NFA perennially runs out of buffer stock.

Second, under the Agricultural Tariffication Act (RA 8178), the quantitative restriction on imports of rice should be converted into regular tariffs. The tariff proceeds should go to assist farmers engaged in agriculture, aquaculture and dairy production. That way, government will have a source to pay for the farming assistance, without having to pass new taxes.  And will probably ensure sufficient supply of rice in the country, making rice more affordable.

Selling price of rice pegged by government at P38 to P40 per kg represents 9.30% to 9.78% of the ordinary Filipinos daily wage of P408.8.   A family of 6 probably consumes around 2 kg of rice a day, or P76 a day for rice alone.

Third, the tariff proceeds augmented by and from annual appropriation to DA, should suffice to fund research and development in high-yield and climate-resistant varieties of rice.   The China hybrid rice technology produces between 9 to 12 tons a hectare.  The Philippine certified seed variety produces between three (3) and three and half (3 1/2) tons per hectare.  Our traditional palay seed produces between 1.5 to 1.8 tons per hectare.

Consequently, investing in food security, particularly rice is an investment for future growth.

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AFTER NOTE: In March 1985, Edgardo Angara helped establish what would become the Philippine Rice Research Institute (PhilRICE).  In May 2008, during the 16th Session of the United Nations Commission on Sustainable Development, Angara called for the elimination of export subsidies and reduction of domestic subsidies of rich countries, citing that in 2005, OECD countries’ combined agriculture subsidies amounted to US$385 billion — which was twice the Philippines’ GNP in 2007.  (Email: angara.ed@gmail.com| Facebook & Twitter: @edangara/PN)
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