Imported rice SRP to be cut to P49 per kilo starting next month
THE Department of Agriculture (DA) is lowering the maximum suggested retail price (MSRP) for imported rice to P49 per kilo starting in March in selected cities.
Agriculture Secretary Francisco P. Tiu Laurel, Jr. said that the new MSRP will apply to Metro Manila and other urban centers.
“In many provincial areas, we’ve seen prices of imported rice already lower than the MSRP. So we will apply it more selectively,” Mr. Laurel said in a statement on Wednesday.
March will mark the first time for the MSRP for imported rice to fall below P50 since the price cap was introduced on Jan. 20.
The MSRP was initially set at P58 per kilo. Prior to its introduction, imported rice consisting of 5% broken grains sold for between P62 and P64 per kilo.
“We will review the numbers in the coming days to determine if there is room to lower the MSRP further. As of now, there could be scope for additional reductions, but we will have to see,” he said.
In January, the DA projected the price of imported rice to fall below P50 per kilo, as long as world market prices remain stable. This assumed a maximum landed cost of $550 per metric ton (MT) for 5% broken rice.
“The landed cost of 5% broken rice was quoted at $490 per metric ton on Friday,” the DA said.
Samahang Industriya ng Agrikultura (SINAG) Executive Director Jayson H. Cainglet said the lowering of the MSRP is a step closer to the ideal price of P40-P45 per kilo for imported rice.
“At the current price of $380 per metric ton of 5% broken Vietnam rice, imported rice should further go below P40/kilo,” Mr. Cainglet said in a statement on Wednesday.
Federation of Free Farmers (FFF) National Manager Raul Q. Montemayor said that the new MSRP starting in March can still allow all parts of the supply chain to recover their costs.
“Our computations show that, even if the tariff is reinstated to 35%, an MSRP of P49 per kilo for rice with 5% brokens would still be feasible and provide cost recovery and decent profits for all market players,” Mr. Montemayor said via Viber.
The MSRP on imported rice is among the DA’s plans to lower rice prices alongside the declaration of a food security emergency on rice on Feb. 3, which allows the release of rice inventories held by the National Food Authority (NFA).
The emergency allows the release of NFA rice stocks to government agencies, local government units (LGUs), and the KADIWA ng Pangulo subsidized-market network.
Mr. Cainglet said the MSRP and the declaration of the food security emergency indicated the “dismal failure” of Executive Order (EO) No. 62 in taming rice prices.
“It is the right time to call for the repeal of EO 62 and generate revenue from imported rice that is earmarked to directly support our rice farmers,” he added.
President Ferdinand R. Marcos, Jr. last year issued EO 62 slashing tariffs on rice imports to 15% from 35% previously until 2028.
The FFF has blamed the tariff reduction along with the lack of restrictions on rice imports for the severe drop in the farmgate price of palay, or unmilled rice.
Citing Bureau of Customs data, the FFF said nearly 4.8 million tons of rice arrived in the country last year, while another 331,000 tons entered the country in January.
“Farmers in Mangaldan, Pangasinan have reportedly postponed selling their palay due to low buying prices of traders. In San Jose, Occidental Mindoro, prices for newly harvested palay have dipped to as low as P13 per kilo,” it said.
“Clean and dry palay is at P19 per kilo, with traders reportedly hesitating to buy stocks due to the influx of imported rice in the market,” it added.
The FFF said that it is seeking the restoration of the 35% tariff on imported rice to induce traders to buy palay at better prices.
“The landed cost of rice with 5% brokens from Vietnam will rise to P33 per kilo if we reinstate the 35% tariff,” Mr. Montemayor said.
“If we add P15 for other costs and trading margins all the way to retailers, imported rice could still be sold at P48,” he added. — Justine Irish D. Tabile
