Infested rice
DEMAND AND SUPPLY - Boo Chanco (The Philippine Star) - August 27, 2018 - 12:00am

Are Filipinos only good for imported bukbuk-infested rice? Or did some people make money on the latest NFA import? Did we pay for good commercial rice, but did NFA agree to receive old stock rice about to be reclassified as animal feed?

The sight of all those little critters running all over the sacks of NFA rice being unloaded from a ship at Subic is appalling. So now the agriculture secretary is saying the rice can still be eaten after fumigation.

 Fumigation involves spraying chemicals to kill those bugs. I don’t know about Duterte’s top agriculture official, but any human being should have a choice not to eat rice tainted with fumigation chemicals.

This proves Sen. Win Gatchalian is right about abolishing the NFA. It has brought nothing but problems even as it eats up a lot of our tax money in subsidies on their operations.

Beyond infested rice, we are in a race against time to fix our agricultural sector. The sector’s growth had been flat, even as food inflation was at a high of 7.1 percent last month. Food accounts for a significant part of the consumer basket measured for inflation.

 The first thing that should to be done is to figure out how to lift the farmer out of poverty. There should be focus on improving his productivity to keep him above subsistence farming. Otherwise, who will want to be a farmer? Food production is growing at a slower pace than population growth.

It is also ironic that for an archipelago, we are now importing galunggong. When I was growing up, it was plentiful and cheap, the poor man’s fish. Not anymore.

Duterte’s score on food security: we now have to eat fumigated old stock imported rice and imported galunggong laced by formalin.

As if this administration is not done trying to kill us, its Department of Energy initially wanted to force oil companies to sell low grade diesel with all its chemical pollutants. Luckily we have a very alert health secretary who raised a fuss about the galunggong and the diesel.

Former finance secretary Gary Teves wrote me in reaction to our previous columns on agriculture. He basically agreed with our comments and offered additional suggestions and updates. Here are some of Gary’s points:

“On the agriculture sector not getting enough help. (Agree) 

“Agriculture is still not in the top budget priorities of the national government, but passage of the rice tariffication bill would supplement agriculture’s limited budget. It is estimated to raise P28 billion in additional revenues, which will be used to create a fund to improve the competitiveness of Filipino rice farmers through mechanization, financing, subsidized inputs, education, R&D, etc. 

“However, we suggest removing government’s requirement to license rice importers. Rice, upon the implementation of tarrification, should be treated just like any other imported food product. 

“On too fragmented farms and the need for economies of scale. (Agree)

“Three decades of agrarian reform have shown that merely giving a farmer ownership of land will not significantly improve his life. 

“We have been advocating to relax CARP restrictions on transferability. Congress should give agrarian reform beneficiaries (ARBs) the flexibility to lease their lands to agro-entrepreneurs, provided that the latter provides the necessary farm inputs that will increase land productivity and raise small farmers/agrarian reform beneficiaries’ incomes.

“Manpower can be provided by the ARB under a profit-sharing arrangement with the agro-entrepreneur, resulting in a win-win situation.  

“On the problem regarding agricultural financing: 

“Universal/commercial banks unable to lend directly to agri and ARB sectors now have options for alternative compliance. As of March, there were 30 accredited rural financial institutions (rural and cooperative banks) which bigger banks can turn to by wholesale lending and/or invest in to comply with the Agri-Agra Law’s requirements. 

“Alternative compliance includes investments in bonds declared eligible by the DA and DAR, loans for construction and upgrading of infrastructure, loans to the NFA and NFA-registered warehousemen, millers, and wholesalers. 

“On Landbank, originally designed to help agrarian reform beneficiaries, becoming more of a commercial bank:

“Starting 1998, Landbank board and management had been pursuing the bank’s mission of returning to its original mandate by allocating more and more of its loanable funds to small farmers, fisherfolk, micro, small and medium enterprises (MSMEs), rural infrastructure and agri-business. 

“In 1998, 68 percent of Landbank’s loanable funds were allocated to commercial borrowers and only 32 percent to small farmers, fisherfolk and MSMEs. By 2004, however, this was reversed with 65 percent going to small farmers, fisherfolk and MSMEs, and 35 percent to commercial borrowers. 

“The bank’s profit continued to grow, amounting to P14.5 billion in yearend 2017 and the sharing of 65 percent (agri-related) to 35 percent (commercial lending) has been maintained up to the present. This information was verified by Landbank’s EVP Julio “Junet” Climaco.

“On encouraging conglomerates to do industrial farming and contract growing. (Agree)

“San Miguel Corp., for instance, already has a contract growing program for cassava, sweet potato, sorghum to supply raw materials for its feed mill facilities. 

“On government having a vision/grand plan for agriculture. (Agree)

“Philippines needs to create a cohesive master plan on how to develop the agriculture sector. Gov’t also needs to seriously consider other more high-value crops in which we have more competitive advantage, e.g. cacao and coffee, to give farmers more income security.

“On opening the agri industry to foreign investors who can share modern technology to improve productivity. (Agree)

“Philippines should lift the restrictive economic provisions and allow foreign investors who have the capital, technology and expertise to develop agriculture.

“In summary, the government should give more attention and resources to agriculture to increase productivity, generate more jobs, and, hand-in-hand with the private sector, enable it to become a primary mover of the Phillippines economy. 

“A higher agricultural growth rate is needed to grow the Philippine economy faster and attain more inclusive growth and development sooner.” 

Boo Chanco’s e-mail address is . Follow him on Twitter @boochanco

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