Rice imports may not lower prices of staple food NGO

MANILA, Philippines – A non-government organization doubts that allowing private importation of rice would lower prices of the staple.

The Rice Watch and Action Network also warned yesterday that Agriculture Secretary Arthur Yap’s plan to extend the National Food Authority’s (NFA) tax subsidy to private traders would deny the government the needed revenue to improve local rice production.

Jessica Reyes-Cantos, of Rice Watch and Action Network, said lifting import restrictions would open the floodgates for unscrupulous rice traders, who have the financial capital to import rice amid rising world prices.

“We doubt if the government will be able to stop private traders from dictating higher prices during this period when the NFA failed to abet the skyrocketing prices despite the harvest season this April,” she said.

“The situation is not ordinary and particularly critical in the lean season of July to September when the private traders can definitely take advantage of the situation.” Cantos said imported rice, even with only a 10 percent tariff, could still result in prices as high as P36 per kilo, almost double the existing P18.25 price of NFA rice.

Their computation is based on the average world market price of $747 per metric ton of rice, she added.

Cantos said the international price of rice will equate to P36.15 per kilo in the local market with a 10 percent tariff, giving the rice trader a margin of only 10 percent for packing and hauling expenses.

“The traders will definitely make a substantial gain with lower tariffs and the price outlook is not about to get better in the next three months,” she said.

“The people are scrounging for low-priced NFA rice and the government will have nothing in its shelves to provide to the people because the private traders are controlling the bulk of supply,” she said.

The price of rice in January last year was only $430 per ton and sharply rose 73 percent to the present price of $747 per ton in a matter of three months, Cantos said. – Marianne Go, Jaime Laude