Alloted farm subsidy seen not enough | Inquirer Business

Alloted farm subsidy seen not enough

By: - Reporter / @kocampoINQ
/ 05:16 AM February 20, 2019

Industry stakeholders have expressed their doubts over the government’s yearly P10-billion subsidy for the rice industry under the Rice Import Liberalization Act, saying this might not be enough to ensure the competitiveness of local rice producers.

Industry leaders told the Inquirer it would take time before farmers would feel the effect of the interventions to be financed by the annual subsidy, which could discourage farmers from planting rice and, thus, cut total production.

Under the new law, a P10-billion subsidy would be given to the farm sector yearly, half of which would be used to purchase farm equipment, P3 billion for research and seed inputs, P1 billion for credit and P1 billion for training and seminars.


Sen. Cynthia Villar, proponent of the bill and chair of the Senate Committee on Agriculture and Food, said the subsidy would be provided until such time that the collected duties from rice imports would be enough to fund the sector’s programs.


The National Economic and Development Authority (Neda) said the policy’s impact on farm productivity might be felt in one to two years’ time.

Grain Retailers Confederation of the Philippines (Grecon) president James Magbanua said farmers would have a hard time competing with more affordable imported rice without immediate support from the government, noting that the cost of producing rice in the country was double of those in other rice-producing countries like Vietnam and Thailand.

“Our worry is that this may discourage local farmers to plant later on, and the government should always be ready against the threats of climate change. We need to be able to produce our own rice,” he said.

Samahang Industriya ng Agrikultura (Sinag) chair Rosendo So said the rice sector “can only start to be competitive once cost of production is lowered.”

“Even if we become productive, unless the production cost is lowered, farmers would still be on the losing end,” he said.

In Vietnam and Thailand, where most of the country’s rice imports come from, a kilo of rice is being sold at P21 and P25, respectively. Even with additional freight costs, these are still considered cheaper than local rice which are sold at P34 to P39 a kilogram.


Rice watch group Bantay Bigas said the RCEF was not enough to help the country’s 2.7 million farmers, adding that it might just be “another source of plunder for government officials of the Duterte administration.”

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TAGS: rice, Rice Import Liberalization Act, rice industry, Sen. Cynthia Villar, subsidy

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