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DA declares food security emergency

DA declares food security emergency
A man takes sacks of newly delivered Kadiwa ng Pangulo rice to a stall at the Kamuning Market in Quezon City on February 3, 2025 (Michael Varcas)

Max SRP of 55/kilo for imported rice takes effect

MANILA, Philippines — The country has been placed under a food security emergency as measures set in place by the government to pull down rice prices have failed.

Citing an “extraordinary increase in rice prices,” Agriculture Secretary Francisco Tiu Laurel Jr. issued yesterday Department Circular No. 3 formally declaring a food security emergency, based on a resolution of the 10-member National Price Coordinating Council (NPCC).

He said that under the newly enacted Republic Act 12078 or the Agricultural Tariffication Act, the secretary of the Department of Agriculture – upon the recommendation of the NPCC – may declare a food security emergency to address supply shortages or extraordinary increases in rice prices.

“On the basis of the recommendations (of the NPCC), the secretary hereby resolves to declare a food security emergency on rice due to extraordinary increase in prices,” Tiu Laurel said in his department circular.

Aside from the DA, members of the NPCC include secretaries of the Departments of Trade and Industry, Health, the Interior and Local Government, Environment and Natural Resources, Justice, Energy and Transportation as well as the National Economic and Development Authority.

“The state of food security emergency shall remain in force and effect until lifted or withdrawn by the secretary,” Tiu Laurel said.

He said that NPPC Resolution No. 01 cited the report of the Philippine Statistics Authority that rice inflation in July 2023 reached 4.2 percent, exceeding the upper limit of the four percent food inflation target under the Philippine Development Plan 2024-2028.

Tiu Laurel received the NPCC resolution on Jan. 30.

He said rice inflation further increased, reaching 17.9 percent in September 2023.

“The (NPCC) resolution determined that rice prices remain elevated, emphasizing that in December 2024, the price levels of regular milled rice and well-milled rice were respectively 19 percent and 20 percent higher compared to the period before the price spikes in July 2023,” Tiu Laurel noted.

He said the NPCC has resolved to adopt a formula for determining extraordinary price increases.

“There is an extraordinary increase in the price of rice when the rice inflation has exceeded the upper bound target for food inflation and reached double digits,” Tiu Laurel pointed out.

He said that as provided for in the NPCC resolution, the formula for the determination of the existence of an extraordinary increase in rice prices shall be subject to review every four months.

With the declaration of food security emergency, the National Food Authority (NFA) can start selling its rice stocks at P36 per kilo to local government units, which can resell it at P38 per kilo.

Tiu Laurel said that at least 300,000 metric tons (MT) of NFA rice will be released in the market.

Aside from the food security emergency, the DA has implemented a maximum suggested retail price of P58 after Executive Order 62, which lowered the tariff on imported grains to 15 percent, failed to bring down the retail price of rice.

The maximum SRP will further decrease to P55 per kilo beginning Feb. 5, Tiu Laurel said.

“As I previously said, the next maximum SRP will be P55 (per kilo) by Feb. 5. The maximum SRP for imported rice should be P55 and again by Feb. 15, it (maximum SRP) should be P52 (per kilo) and by March 1, the maximum SRP for imported rice five percent broken should be P49 per kilo,” Tiu Laurel said.

A maximum SRP of P58 per kilo took effect on Jan. 20 as rice prices remained elevated despite the implementation of EO 62 which lowered the tariff on imported rice to 15 percent from the previous 35 percent. President Marcos signed EO 62 in June 2024 and it took effect in July.

He said retailers were able to comply with the maximum SRP on imported grains.

“I am happy to report that almost all were able to comply based on the monitoring of the DA, the Department of Trade and Industry and Philippine National Police. I cannot say 100 percent as it is possible that we did not see (those selling beyond P58 per kilo) but all the markets that we visited were able to comply with the maximum SRP,” Tiu Laurel added.

He noted that world rice prices continue to go down. Based on the monitoring of the DA in Metro Manila markets, the retail price of imported special rice was sold between P52 and P61 per kilo. The P61 per kilo was still high compared to the P58 maximum SRP set by the government.

Imported premium rice ranged between P51 and P58 per kilo; imported well-milled rice, between P44 and P52 per kilo and imported regular milled rice, between P38 and P48 per kilo.

At the same time, Tiu Laurel said that Kadiwa ng Pangulo will continue to sell affordable rice until the end of the term of President Marcos in 2028. “We plan to run it (Kadiwa ng Pangulo) until the last day of this administration,” he said.

Agriculture Assistant Secretary for agribusiness, marketing and consumer affairs Genevieve Velicarica-Guevarra has said that at least 57 more Kadiwa ng Pangulo stores will open in Metro Manila where affordable rice varieties will be available.

Incompetence

For the Federation of Free Farmers (FFF), the food security emergency declaration was meant to cover the inability of the NFA to manage its rice stocks properly.

“An emergency declaration would allow NFA to sell its inventory to national government agencies, local government units and Kadiwa stores, thereby freeing up warehouse space for the agency’s palay procurement,” FFF president Diosocoro Granada said earlier yesterday.

According to Granada, almost one-third of NFA’s current inventory of 300,000 MT could already be classified as aging rice and should have been disposed of earlier through public auction to interested buyers without need for an emergency declaration.

“A food emergency announcement, however, would authorize NFA to sell its stocks to government agencies at subsidized, below-market rates. Aside from causing the agency to incur huge financial losses, the sale of cheap NFA rice could open the door to widespread leakages and corruption. It could also work against farmers if traders decide to lower their palay buying prices to compete with NFA rice,” Granada added.

He noted that congestion in NFA warehouses could have been avoided or minimized through proper disposal of stocks during the many calamities in 2024 and programmed sales of aging rice.

He added that palay and rice stocks in major production areas should have been transferred in advance to urban centers and other demand areas in preparation for the agency’s palay buying and rice distribution activities.

At the same time, Granada belied claims that the NFA’s warehouses are filled to the brim, noting that the agency’s warehouses have a total capacity of over one million tons, of which less than one-third is currently being used.

Earlier yesterday, FFF national manager Raul Montemayor asked the DA to fully study the legality of declaring food security emergency. — Bella Cariaso

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Credit belongs to: www.philstar.com

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