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Rice tariffication up for approval; NFA future at stake

President Rodrigo Duterte will soon sign into law the rice tariffication bill, Malacañang said on Wednesday after the Chief Executive certified the measure as urgent two months ago.

“It has been submitted to the Office of the President. I suppose it will be signed anytime,” said Presidential Spokesman Salvador Panelo said in a Palace press briefing Wednesday.

The Rice Tariffication Bill aims to lift the quantitative restrictions on rice imports, allowing private traders to import grain from countries of their choice.

Under the bill, the private sector will be permitted to import rice. They, however, have to secure a phytosanitary permit from the Bureau of Plant Industry and pay the 35-percent tariff from neighbors in Southeast Asia for shipments.

In endorsing the bill, Duterte told Congress that the proposed measure would address the urgent need to improve the availability of rice in the country, prevent artificial rice shortages, reduce the prices of rice in the market, and curtail the prevalence of corruption and cartel domination in the rice industry.

However, once Duterte signed the measure into law, the National Food Authority will stop selling government-subsidized grain.

Under the current process, the NFA is tasked to stabilize rice prices by buying grain from farmers and selling it at a cheaper cost compared to commercial rice from P27 to P32. The proposed rice tariffication law, on the other hand, removes the NFA’s authority to import and distribute cheaper rice.

According to the government, at least 500,000 metric tons of imported NFA rice will arrive in the country by January 2019, but this will only be enough for two months.

Panelo said liberalization in the rice market will foster competition even after being told about a potential adverse reaction from the public.

For his part, Cabinet Secretary Karlo Nograles said Duterte will ensure that even with the rice tariffication, “the NFA shall continue to provide the public, particularly the less fortunate, with rice that is affordable and safe.”

“Once the law is passed, the NFA will be directed to buy palay from our local farmers and, together with the Department of Agriculture, to focus on developing cost-efficient systems that will help reduce the production costs of locally-produced rice and stabilize prices so that this food staple is accessibly priced,” Nograles told Palace reporters. Nat Mariano

Asked why the signing of the said bill had been stalled for two months, Panelo said the President was occupied with too many work-related issues, but he will decide on the matter “soon enough.”

The NFA’s officer in charge Tomas Escarez said once the law is approved, the agency would lose its power to import and distribute cheaper grain.

The law will leave the NFA with the sole task of buying grain from farmers to maintain buffer stocks for calamities and emergencies, he told radio dzMM.

In a statement, the NFA said with unhampered importation, more traders would buy rice than palay, which would leave most farmers empty-handed.

“Even small rice traders will also be affected under the rice tariffication law as rice retailing and wholesaling will be completely placed in the hands of the private sector. There are [at present] 74,875 NFA-licensed grains businessmen nationwide. More than 50,000 of them are into grains retailing. The NFA’s 15,892 accredited retailers that sell NFA rice at P27 and P32/kilogram will eventually lose their livelihood and consumers will no longer have access to rice at these prices,” Escarez said.

Without regulation, consumers may also fall victim to illegal trading activities such as mislabeling, adulteration of rice stocks, short weighing and under weighing of commercial rice, the NFA warned. These illegal activities need to be monitored and erring businessmen apprehended to protect the consumers.

Topics: Rodrigo Duterte , rice tariffication bill , Salvador Panelo , National Food Authority
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