The Philippines may see a significant decrease in rice prices by as much as 20% in September, according to Finance Secretary Ralph Recto. This anticipated decline is attributed to an expected rise in production and a potential reduction in tariffs.
Speaking at the Philippine Economic Briefing, Recto indicated that the price reduction could commence in the third quarter of the year. Currently, local commercial rice prices range from P45 to P66 per kilogram, while imported commercial rice costs between P49 to P65 per kilogram.
“With respect to the rice prices, I expect rice prices to go down by 20% maybe by September. This will entail: one, increase in production; and second, the reduction in tariffs,” Recto stated.
The Rice Tariffication Law (RTL), effective since March 2019, permits unlimited rice importation provided that private traders obtain a phytosanitary permit and pay a 35% tariff for imports from Southeast Asian neighbors. The law also allocates P10 billion for the Rice Competitiveness Enhancement Fund (RCEF) to support farm mechanization and seedling programs.
“Maganda ‘yung hating kapatid (It would be nice to divide it equally), 17.5%—could be 20%. I leave that to the Secretary of Agriculture first to discuss with his constituencies di ba, kailangan may hearing ‘yan eh (a hearing is needed for that). There are about 3 million farmers and 115 million consumers or 112 million, so good balance should be [achieved],” Recto noted.
Recto also mentioned supporting proposed amendments to the RTL, allowing the National Food Authority (NFA) to buy and sell rice during emergencies. The Department of Finance is currently reviewing these proposed changes.
The United States Department of Agriculture (USDA) recently projected that the Philippines would remain the world’s largest rice importer by 2025, with an estimated 4.2 million metric tons of imports.