Rice prices remain low amid influx of imports

MANILA, Philippines — Prices of Filipinos’ main staple remain low and stable at the start of the 2020, but  at the expense of farmers who continue to earn less following the influx of imported rice.

Latest data from the Philippine Statistics Authority (PSA) showed consistent lower prices at the start of the year, nearly a year after the Philippines opened its rice industry to more private sector imports.

In its regular update on palay, rice and corn prices, PSA said the average wholesale price of well-milled rice is now at P37.24 per kilogram as of the first week of January.

This is 11 percent lower than the P41.82 per kilo level from the same period a year ago and 0.2 percent down on a weekly basis.

Its average retail price also decreased by 8.3 percent to P41.45 per kilo.

Meanwhile, the wholesale price of regular-milled rice was P33.02 per kilo, down 15 percent while its average retail price was at P36.53 a kilo.

While consumers are benefitting from the opening up of the market, local farmers are suffering from declining palay farm gate prices.

The average farmgate price of palay is nowhere near recovery at P15.79. This is, however, a one percent improvement from the earlier week’s level of P15.63.

The current price is still a 21 percent drop from the P19.95 per kilo in 2019.

The lower farmgate price is caused by the just concluded main harvest season and is even exacerbated by imports flooding the commercial market.

Last year, the Philippines imported three million metric tons (MT) of rice, making it the world’s largest importer of the commodity.

Total rice inventory as of December stood at 3.09 million MT, 14 percent higher than the 2018 volume stock of 2.72 million MT.

Under the Rice Tariffication Law, quantitative restrictions on rice importation are lifted and private traders are allowed to import the commodity from countries of their choice.

The Rice Tariffication Law replaced the government’s quantitative restrictions on importation of the staple with a 35 percent tariff.

The measure also created the Rice Competitiveness Enhancement Fund or a special rice buffer fund, with an initial P10-billion annual fund, to ensure rice production competitiveness.