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DOF calls for warehouse receipts bill passage

The Department of Finance (DOF) is calling for the passage of the Warehouse Receipts Bill to professionalize the industry as well as help the country in attaining food security.

In a DOF Economic Bulletin on Sunday, Dec. 26, Finance Undersecretary and Chief Economist Gil S. Beltran said storage, especially cold storage facilities, are crucial in stabilizing food prices in country.

“Once passed, the Warehouse Receipts Bill will usher in the professionalization of the warehousing sector and contribute to food security,” said Beltran in a report submitted to Finance Secretary Carlos G. Dominguez III.

While transportation infrastructure geographically links farms and markets, Beltran noted that storage smoothens consumption across time and between seasons.

“Fresh food items, in general, are highly perishable commodities. Aside from transportation, therefore, storage is also important,” Beltran said. “We have to consider the whole food supply chain.”

The Warehouse Receipts Bill has been passed by the House of Representatives and subsequently submitted to the Senate.

Since 2013, food contributed 1.21 percentage points to the country’s headline inflation.

Food price inflation is an important socio-economic issue as food accounts for much of the budget of poorer households, Beltran said.

“As food price inflation persists, calls for wage increases mount, which, if realized, could fuel further supply-side inflation which, in turn, could discourage investments,” the finance official said.

Over a period of eight years, annual overall inflation averaged 2.66 percent while food, 3.33 percent.

While food accounts for a little over a third of the consumer price index basket, it has accounted for close to half of the inflation rate over the period.

But following the conversion of rice import quotas into tariffs, under the Rice Tariffication Law, the staple food is no longer a perennial source food inflation risk.

“Rice price has since stabilized and partly dampened the effects of the most recent sources of inflation rate spikes—fish, meat, and vegetables—owing to supply disruptions caused by weather disturbances and diseases,” Beltran said.

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Credit belongs to : www.mb.com.ph

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