Farmers decry rice import plan by PITC

MANILA, Philippines — The Federation of Free Farmers is questioning the legality of the planned importation of 300,000 metric tons or six million cavans of rice by the Philippine International Trading Corp. (PITC).

PITC recently issued the guidelines on the supply of imported rice with 25 percent brokens on a government-to-government basis, slated to be delivered to various ports between June 22 and July 22.

Nearly P8 billion has been allocated for the first G2G purchase of the Philippines since the Rice Tariffication Law was enacted last year.

While the implementing rules and regulations of the law provided for government importation through PITC, it is only permitted  in the event of a rice supply shortage and only upon the issuance of a directive from the president to the secretary of trade and industry and the PITC.

The liberalization of the rice industry has removed the import monopoly of the National Food Authority and effectively opened up the domestic market to unlimited and unrestricted imports of rice by the private sector.

FFF national manager Raul Montemayor said Agriculture Secretary William Dar has repeatedly insisted there is enough rice.

“If, as Secretary Dar implies, there is no rice shortage, then there is no legal basis for PITC to import rice under the RTL,” Montemayor said.

He warned that PITC imports could result in significant losses to the agency and the government could end up penalizing the country’s rice farmers.

PITC imports may likely amount to P25 per kilo. If PITC matches NFA’s current selling price, it will end up with estimated losses of P5 per kilo or P1.5 billion from financing, storage, distribution and related costs.

Since PITC imports will be exempted from tariffs, the government will additionally forego P2.6 billion in tariff collections.

“In turn, farmers who are supposed to benefit from tariff collections on imports through the Rice Competitiveness Enhancement Fund will be shortchanged by P2.6 billion,” Montemayor said.

The approved budget for the PITC importation is also larger than the P7 billion that has been allocated to the NFA to procure palay (unhusked rice) from local rice farmers, which may send a bad signal to rice farmers who are being encouraged by the DA to continue planting.

“But when it comes to imports, there always seems to be a ready budget and very few reservations. Apparently, there is something very attractive in government imports, even if they are not actually needed,” Montemayor said.

He said there appears no official pronouncement from President Duterte of a rice shortage, nor a formal authorization for the DTI and PITC to proceed with imports.

“The IATF resolution last March 30 merely endorsed to the Office of the President the proposal of the DA to import rice through the PITC as a contingency measure. It is not clear, however, what contingency is being addressed considering that the DA has repeatedly stressed that we have more than enough rice up to the end of the year,” he said.

FFF warned that disbursements for PITC imports could be disallowed by the Commission on Audit and PITC officials involved may be charged with graft if the proper legal basis for the imports is not established.

The farmers’ group questioned the rationale for the importation considering that the RTL was supposed to remove the government from any active role in rice trade.

Proponents of the RTL had argued that the private sector and the international market were more efficient and reliable in supplying rice, even during times of crisis and emergencies.

“Why are the DA and the IATF now backtracking and reverting to government importation, which is supposedly graft-prone and expensive. Why is the DA, and not the DTI, the one pushing for PITC imports when the DA itself has declared that there is no rice shortage,” Montemayor said.

“In fact, the DA has already issued sanitary permits for 2.7 million MT of rice imports by the private sector, which is much more than what the country needs,” he said.