The government is now studying the early opening of what could possibly be the last private sector importation of rice under the minimum access volume this year, the Office of the Cabinet Secretary said on Thursday.
Halmen Valdez, undersecretary for the Office of the Cabinet Assistance System, a unit tasked to supervise the
National Food Authority, said the early opening of MAV, among other options, will allow the Philippines to fill its rice requirement before the quantitative restrictions expire in July 2017.
“If there will be a need to import under the MAV scheme, this should be done before June 30. After that, it will be tariff-based restriction,” Valdez told The Manila Times in a telephone interview.
“President Rodrigo Duterte has announced that he will honor all international commitments, and MAV is one of those commitments,” she added.
MAV is the minimum volume of farm produce allowed to enter the country at reduced tariff of 35 percent. Shipments outside the scheme carry tariff rates of 40 percent and must be approved by the NFA.
The Philippine has set a limit of 805,000 metric tons on rice under the MAV scheme.
The interagency National Food Security Committee has determined that there is no urgent need to import additional rice, considering that importations under the 2016 MAV is still ongoing.
“About 600,000 metric tons of rice, through private sector importation, just starting to arrive,” Valdez said.
“Traders have until end of February to complete the arrivals. Only then can we determine the volume that we need should there be additional importation,” she added.
The official noted that government-owned warehouses have more than the 15-day mandated rice stock.
Valdez, however, said the food security council is scheduled to meet this month to discuss the possible scheme for the next rice importation, including a government-to-government deal.
“At present, there is still no need to utilize the remaining 250,000 metric tons under the standby authority. Within this month, the NFSC may already decide whether there is a need to import rice in consideration of the damage sustained from the previous typhoons,” she said.
“It’s a numbers game. We still have to determine whether the G2G will hav e an effect on the financial viability of the NFA, or should we just allow the private sector to import under the 2017 MAV,” she added.
According to the Philippine Statistics Authority, the country has enough rice to last 98 days from the following:
• 49 days in households stocks
• 32 days in commercial warehouses
• 17 days in NFA warehouses
As of December 1, 2016, the total rice inventory was at 3.34 million MT, up 1.11 percent or 3.30 million MT in November but down from 3.44 million MT in December 2015
Validation of importers
Cabinet Secretary Leoncio Evasco Jr. said the government is now validating traders for the private sector rice importation scheme to weed out unscrupulous traders and importers from the NFA database.
“The current validation scheme will help the NFA to determine legitimate importers for future importation,” Evasco said.
Evasco noted unscrupulous traders and importers have used farmer cooperatives as dummies under the private sector rice importation scheme to corner the bulk of imports.
“There are also reports that traders have been unloading at port more than what is allowed in their permits,” he said.
Ready for competition
The government is prepared for the lifting of the quantitative restriction on rice next year, Agriculture Secretary Emmanuel Piñol said earlier.
“Understand that if we want to extend [the QR on rice], it should have been two years ago. We are asking for two more years, but this may not pass,” Piñol said, referring to the policy direction of the Cabinet economic cluster.
Finance Secretary Carlos Dominguez, Budget Secretary Benjamin Diokno, NEDA Director General Ernie Pernia and consultant Ciel Habito want to do away with the QR on rice to liberalize trade.
Evasco was also quoted as being in favor of scrapping the NFA.
“While certain quarters have called for the tariffication of the QR, the Department of Agriculture is of the position that it should be extended for at least another two years to allow this Administration’s support programs to firmly take root and set the sector on the proper path of sustained self-sufficiency at competitive levels,” Piñol said.
“Exposing the sector, particularly the small rice farmers, to unbridled international competition from heavily subsidized exporters will cost the country huge social and economic consequences,” he added.
Rice has direct links to food and livelihood security as well as rural development in developing countries like the Philippines.
Unlike other agriculture products, basic staple of Filipinos was not tariffied. Instead, farmers were protected by the quantitative restrictions on imported rice.