EDITORIAL - Rice competitiveness

It’s been half a year since President Duterte signed the law allowing the unlimited importation of rice. Tariffs imposed on the imported grains are supposed to go to a Rice Competitiveness Enhancement Fund, which is intended to boost the productivity of local rice farmers.

Rice prices – one of the major factors in the inflation surge last year – have since fallen with the flood of imports, many of which are sold cheaper than comparative local varieties. Naturally, consumers welcome the price drop. And naturally, rice farmers are groaning from the plunge in the buying price of their crops.

The Philippine Statistics Authority reported that in June, farmgate price of palay had dropped by 16.4 percent to P17.88 per kilo, but farmers’ groups said the price had plummeted to as low as P12 in some areas. Opponents of the rice tariffication scheme have warned that the measure could discourage small-scale farmers – mostly beneficiaries of the agrarian reform program – from producing rice, with the immediate short-term impact of the law causing them to leave rice production for good in favor of more profitable sources of livelihood.

Proponents of rice tariffication are moving to prevent this from happening.

It will take some time for farmers to reap the full benefits of the investments in the infrastructure and other farm support services to be financed using the Rice Competitiveness Enhancement Fund. So the Senate wants to conduct an early inquiry into the utilization of the RCEF, which was created through the tariffication law or Republic Act 11203. A regular monitoring scheme is expected to be implemented, to ensure that the funds are not diverted to other purposes.

Other measures are being considered, such as the use of the RCEF for fertilizer and irrigation support to boost local farmers’ competitiveness. Fears were raised about the possible long-term adverse impact of rice tariffication on local rice production. Proponents of the measure must see to it that the fears don’t come true.