A congressman warned of a possible rice price crisis in the weeks to come as drought continues to pummel staple grains sources like Thailand and Vietnam, aggravating the impact of the coronavirus disease 2019 pandemic on rice importing countries such as the Philippines.
Albay 2nd District Rep. Joey Salceda, who chairs the House ways and means committee and serves as co-chairman of the House stimulus cluster, said a rice price crisis would make the country’s response more costly, as world stocks are being kept out of trade by export bans.
He said the Agriculture and Trade Departments should anticipate apparent challenges in supply pointing to “warning signs” of upcoming issues on rice price and accessibility in the coming weeks.
“I was shocked when I started buying rice from the NFA [National Food Authority] for my relief donations, then at P1,250 per bag only. When the NFA stock ran out, we purchased from commercial stores and the prices progressively shot up and recently hit P1,850 per bag. What happened? I thought there was a rice price freeze,” he said.
Data showed that as of March 1, the country’s total rice stock inventory stood at 2,178.64 million metric tons, 1.9 percent lower year-on-year and 8.3 percent lower month-on-month. The harvest season was not expected to start until May.
Salceda said China’s withholding from Mekong and temptations towards export ban were posing risk to supply. “The current COVID-19 crisis should remind policy makers that food security and health goods security are two vital national concerns,” he said.
Salceda also cautioned DA and DTI about possible manipulations from rice cartels to take advantage of the emergency and derail government’s urgent efforts to deliver foodstuffs on time to communities under the enhanced community quarantine.
“How prices actually are in public markets and other retail outlets depend on transport, logistics and demand situations in these areas. While bulk purchases by government and provision of rice as relief goods for lower income families are expected to dampen price increases in the aggregate, issues in transport, logistics, and the presence of local cartels may push prices upwards,” he said.
The lawmaker urged DA and DTI to “unchain the whole supply chain” for smooth delivery of food requirements to communities through government checkpoints most of which, he said, seem confused by regulations and thus, in most instances, unduly stall the vital food supply delivery.
“Historically, we’ve had challenges with rice price and supply in economic and social crises, but those challenges were rarely about having enough rice for everyone. The issues have always been about getting the national supply of rice into the communities needing the staple. These challenges are made starker now by delays in ECQ checkpoints,” Salceda said.
He said there were existing export bans in Vietnam and Cambodia due to drought and low water supply from the Mekong river. He also cited global data showing rice prices in the world market went up by as much as 12 percent weekly since the first week of April.
“Hence, the need to be prepared. Our monitoring will have to span the whole chain, from farm to points of retail sale. Harvest season doesn’t come until May. So, we have to be better prepared,” he said.
Salceda said ensuring the adequate supply of rice and other prime commodities is essential to effective enforcement of ECQ and other non-pharmaceutical interventions.
“The surer the supply, the less likely people will violate stay-at-home and quarantine rules. If they’re not sure they can buy rice at fair prices, our people will break the rules,” he said.
The Albay lawmaker also bewailed persisting issues about checkpoints. “Just recently, the National Food Authority reported that some drivers of 14 trucks carrying 14,000 sacks of rice from Regions 1, 2 and 3 failed to meet at their Malolos warehouse and haul rice to Valenzuela and Cavite. Only 8 trucks reached the Malolos warehouse because the other six were allegedly held at quarantine checkpoints,” he said.
In a paper titled “Potential Issues in Rice Supply in the Philippines during the ECQ”, Salceda recommended the several measures to ensure adequate supply in all areas.
The said DA and DTI should monitor the strict implementation of their respective issuances on the flow of rice and other essential commodities as well as the necessary inputs to produce and process these commodities, such as fertilizers and pesticides.
He said to burst artificially inflated prices in local areas, DA and the DTI may open mobile stores and other similar schemes that sell rice and other commodities at fair prices.
Salceda cited the need to facilitate matching of rice producers and markets to keep middleman costs at a minimum and Develop an online, citizen-based monitoring of the prevailing prices of rice and other prime commodities.
He said in localities with anomalously higher prices compared to baseline or expected prices, DTI and DA should use appropriate interventions such as stricter monitoring and enforcement of retail price measures.
The system will also allow consumers to compare prices in nearby areas, making local cartel practices easier to spot and prevent.
He also cited the need to secure commitments for adequate supply from supplier countries such as Vietnam and Thailand, while also sustaining support for local production through programs such as the Rice Competitiveness Enhancement Fund and the National Rice Program.
His other recommendations include relaxing rules on rice importation and consolidating small import orders through the Philippine International Trading Corporation and ensuring that the labor force across the rice supply chain (from farmers, to mill workers and transport drivers) are able to work and are conferred the privileges granted to those who work in essential services.
