Debate on rice strategy continues

(Conclusion)

Contrary to the administration’s action plan and recommendations from economists, industry group Samahang Industriya ng Agrikultura (Sinag) wants the country to reach its decade-old dream of rice self-sufficiency and stop relying on imports.

The group maintained that if the government would subsidize rice farmers in the production to marketing stage, raise the National Food Authority’s (NFA) farmgate support price for palay and incentivize local rice millers to modernize operations, producing our own staple would be more beneficial for the country in the long run.

It cited data from the latest report of the United States Department of Agriculture where it noted that less than 10 percent of global rice production was tradeable, with 66 percent already allotted to China.

“Shortage may happen with limited supply of rice going around the market,” the group said. “The greatest tragedy of our times is the destruction of our capacity to produce our own staples.”

Food security

But for former Economic Planning Secretary Cielito Habito, food security does not equate to rice self-sufficiency.

“The most unfortunate irony of all is that under current circumstances, the more we pursue 100-percent rice self-sufficiency, the more we make most Filipinos food-insecure. Food security and food self-sufficiency are two different things. Food security denotes reliable access to adequate, affordable, safe and nutritious food. Our self-sufficiency policy has had the perhaps unwitting effect of making rice much more expensive to Filipino consumers than it needs to be, with the Filipino poor suffering the most,” he said.

Habito emphasized the need for the present administration to help farmers diversify their produce accordingly by choosing crops that are more suitable to their lands, and stop chasing the elusive goal of rice self-sufficiency, which, over the years, has been proven to be unsuccessful despite numerous government interventions.

Historically, rice has taken the lion’s share of the agriculture budget. For 2018, the agency will continue advocating the use of hybrid rice seeds, and loan and insurance programs are expected to cater mostly to rice crops.

“Our marginal rice farmers should be assisted to shift to other more remunerative crops suitable for their lands. Meanwhile, utmost productivity support must be given to our rice lands that are inherently competitive in rice, including in Central Luzon and Western Visayas,” said Habito.

Economist and Ateneo professor Leonardo Lanzona Jr. agreed, emphasizing that the country must now move away from prioritizing the production of the staple.

“It would be better to use funds that we have for producing high-value crops or improving technology. Ever if we move some of the rice producers to planting high-value crops, our growth would continue to increase. But, of course, we need to have some agricultural development program,” he said.

“Lifting the QR will benefit the public in general, but there should be a social protection for farmers. Subsidize to a limited extent, but what is more important is to give them incentives to look for other options,” he added.

Lanzona said that the shift to other crops from rice would not mean neglecting the agriculture sector. For him, the farm sector must be developed toward a direction where the Philippines might have a comparative advantage against other countries. “Right now, we don’t have a comparative advantage on rice anymore.”

Both economists said they believed that food security should be best pursued at the regional level, and this is where Asean plays a crucial role.

“Asean as a region is not only self-sufficient in rice, it produces a surplus and can continue doing so for a time,” Habito said. “Food security can be achieved through a stronger regional buffer stock where the rice-surplus countries can fill the deficits of the rest. That way, rice could be cheaper for all, and Asean peoples, particularly in the rice-deficit countries, would generally be much more food-secure. This is what the Asean Economic Community should be about.”

At present, a food security scheme has been established among members of Asean along with China, Japan and Korea in 2016, creating an emergency rice reserve for the region called APTERR or Asean Plus Three Emergency Rice Reserve.

The program provides an exclusive market for the countries to buy rice from in case of natural calamities or emergencies, without distorting the international rice market.

Currently, the total earmarked emergency rice reserve pledged by APTERR member-countries is placed at 787,000 MT. According to the NFA, the Philippines has been benefiting from APTERR since 2010. In the wake of Typhoons Ondoy and Juan and the occurrence of La Niña and flash floods in the country, Thailand donated 520 MT of rice to the country through APTERR.

“Since 2012, at least 7,200 MT of rice had been donated through the program to the Philippines for the victims of Typhoons Pablo, Yolanda and Nona,” the NFA said.

With the nearing influx of imported rice, policymakers must make sure that the country’s rice requirement is met by all means. At the same time, local farmers should be well-equipped to survive the evolving market.

Right now, the challenge is to make sure that rice farmers can compete at a price 35-percent higher than imported rice, and give consumers the option to avail themselves of the staple at a more affordable price.