MANILA, Philippines — The Department of Agriculture (DA) is set to ban cooperatives from importing agricultural products, and limit the issuance of permits for rice importation to just five months a year to protect local producers from smuggling syndicates.
The DA’s move came after senators hit agriculture officials at a Senate inquiry yesterday into the massive rice importation by traders and smuggling syndicates that is depressing local palay prices, pushing small farmers deeper into debt and poverty.
Sen. Cynthia Villar, who presided over the inquiry as chairperson of the committee on agriculture and food, said it is no secret that many farmers’ cooperatives are being used by blacklisted traders as fronts to import hundreds of metric tons (MT) of rice that they undervalue while taking advantage of the tax breaks accorded to coops.
Villar and other senators grilled Bureau of Plant Industry (BPI) Director George Culaste, whom they said was suspiciously lax and liberal in issuing import permits to farmers and irrigation cooperatives to import hundreds of thousands of MT of rice close to harvest season even if all indications point to smuggling.
“Are you not thinking of the welfare of small farmers? Don’t you feel for them? Why are you making their lives difficult?” an irate Villar told Culaste during the hearing via video conference.
“The worst you can ever do to them is to approve imports during harvest season, which means they have to compete with the imported or smuggled rice,” the senator said.
Villar said most farmer and irrigation cooperatives are supposed to be local and formed to help people in their areas but there are cases where registered cooperatives based in Bulacan or Muntinlupa City were found to have huge warehouses all over Mindanao.
Major rice producing provinces, like Nueva Ecija, Bulacan, Occidental Mindoro, Pangasinan and Nueva Ecija are the same areas where a large number of cooperatives are importing rice, which she found ironic.
She said there are 507 listed registered rice importers as of last Sept. 28, of which 212 are rice farmers’ associations, cooperative or irrigators associations, that were able to import a total of 1.017 MT of the grain in 2019.
For this year, the same groups were able to import 632.4 MT of rice.
Sen. Francis Pangilinan cited reports that several cooperatives have opened accounts in one bank and secured permits from the BPI in just one day, which point to “huge operation” orchestrated by someone or groups with “far-reaching tentacles.”
Sen. Imee Marcos, whose resolution triggered the inquiry, said during the hearing that there were also reports that front cooperatives are paid P5 per kilo of rice imported.
Villar lamented that fronts are giving a bad image to cooperatives in the country. She said her foundation for the past six years has been giving awards to the top 20 cooperatives in the country. None of those listed as rice importers were listed as awardees.
Culaste said the last import permit he gave this year was on Aug. 20 but the senators pointed out the authorization was good for 60 days or right smack into the September harvest season.
The BPI official said he already appealed to importers to rein in their operations but the senators said he could just simply impose stricter phytosanitary standards or not issue permits at all.
Bureau of Customs Commissioner Leonardo Guerrero told the committee several importers have been blacklisted and fined, though there are still some P2 billion in fines that are being disputed.
Agriculture Undersecretary Rodolfo Vicerra said his office reviewed the Cooperative Code of the Philippines and found out that only transport coops are allowed to make importations, particularly vehicle parts.
Vicerra said the DA would soon issue an AO to ban coops from making importations of agricultural products.
The senators also asked the DA to suspend the issuance of permits for rice imports during the months of February, March, April, July, August, September and October.
The BPI can only issue permits during the months of January, May, June, November and December.
Vicerra said the DA would heed the lawmakers’ recommendation.
Pangilinan also asked the DA to put in a system to allow trained personnel to inspect rice imports to check whether or not they are undervalued.
Villar had questioned the issuance of rice import permits during the harvest season.
Culaste said that he could not stop issuing sanitary and phytosanitary import clearances (SPSICs).
Farmers, lawmakers and other agriculture stakeholders have long been asking the DA and BPI to control permit issuances so as not to affect farmers currently suffering from low prices of palay.
“During the harvest season, we manage the issuance SPSIC for rice imports. We control it because we cannot really stop [the issuance],” Culaste said.
Villar said the BPI could refuse issuing permits if it really wants to for the sake of the farmers.
The industry’s liberalization opened the floodgates to cheaper imported rice and local farmers could not compete due to the high production cost in the country.
The DA earlier said it is already imploring measures for the strict issuance of permits including pest risk analysis, maximum residue level, checking on the country of origin and even the financial capability of importers.
Lawmakers also slammed BPI’s latest issuance of SPSIC, which was dated Aug. 26. SPSICs are valid for 60 days.
This means that the imports would still coincide with the current harvest season.
Culaste tried to explain that DA and BPI are meeting and appealing with importers and traders to not bring in rice once the harvest season is near.
“You don’t have to call a meeting, just don’t issue a permit. Are the importers the ones paying you? Or is it the government?” Villar said. — Louise Maureen Simeon