Policy Paper Assignment
Policy Paper Assignment
Policy Paper Assignment
RICE TARIFFICATION HURTS FARMERS’ Source: Philippine Statistics Authority (PSA), Palay and Corn
LIVELIHOOD Production Survey (PCPS) Weekly Cereals Price Monitoring
(WCPM)
The high inflation rate of rice price on the last quarter of 2018, lead The prices recorded in the Farm gate is only for good and dry palay,
the government to Rice Tariffication Law to remove the government’s and wet palay may be sold in lesser price. The rice price today is still
restriction on rice importation to ensure the availability of cheaper lesser than the NFA buying price of 19 pesos per kilo when they are
rice in markets. It imposed tariffs on imported rice; 35% for the still full functional. Some of local rice traders even stopped their palay
imports from ASEAN countries and 40% for the imports from non- buying operations because of the overproduction of rice in the
ASEAN countries. The Philippine imported over 3 million metric tons market. The continuous price drop of palay and the inrush rice
of rice after the implementation of the rice liberalization, making the importation causes a huge impact on local Filipino farmers and farm
country the 2019’s top rice importer in the world, surpassing the workers.
previous year China’s rank. This law also removed the National Food Table 2 shows the average cost spent in irrigated palay production in
the Philippine are about Php.11.20 (PSA, 2020). However, according
Authority’s (NFA) regulatory powers over the importations and
to FFF, the price basis of wet palay was reported to range from 11 to
exportations of rice. NFA rice will also be exclusive only for calamity
14 pesos per kilo due to cost of seeds, labor cost, rental machineries,
needs and no longer exercises trading of rice, domestically and and high fuel cost, making farmers barely make money from rice
internationally. Because of this, small and big rice traders are farming.
hesitated to take the risk of buying palay because of their capability
now to manage their own importation of cheaper rice to sell. Table 2. All Palay: Summary of Updated Average Costs of
Alongside of much cheaper price of the rice imports that the local rice Production, by Season and Region, Philippines, 2019
cannot compete, the local farmers suffer distress from financial
bankruptcy, and debt.
Figure 1 shows 2019 average retail price per kilogram of rice was
₱43.01, lower by 4.8 percent than the previous year’s level of
₱45.18. Monthly retail prices of rice showed a decreasing trend, from
₱45.07 in January 2019 to ₱41.48 in December 2019. Monthly
prices were also lower than their respective levels in 2018, except for
the first three months of 2019 (PSA, 2020).
It seems that it is beneficial for the government and big traders but a
challenge for the farmers and the poorest communities and sectors.
References
Calibo, R.A. (2019). Rice Tariffication to slash rice prices-NFA.
Retrieved November 23, 2020, from Philippine Information
Agency website: http://www.pia.gov.ph/
Gomez. E.J. (2020). Congress urged to review rice tariffication law. Retrived
November 24, 2020, from The Manila Times website:
http://www.manilatimes.net/
House of Representatives. An Act liberalizing the
importation, exportation, and trading of rice, lifting for the purpose the
quantitative import restriction on rice, and for other purposes. Retrieved
from http://www.congress.gov.ph/legisdocs/r
Montemayor, R. (2020). Winners and losers from
the rice Tariffication law. Retrieved November 23, 2020, from Inquirer
website: http://www.inquirer.net/