Wazzup Pilipinas!?
The Rice Tariffication Law (RTL), officially known as Republic Act No. 11203, was enacted in 2019 with the intent to stabilize rice prices in the Philippines by liberalizing imports. Authored by Senator Cynthia Villar and endorsed by then Finance Secretary Carlos Dominguez, the law transformed the National Food Authority (NFA) into a mere rice buffer stocking agency, limiting its role to purchasing palay (unhusked rice) from local farmers and supplying rice to government agencies like the Department of Social Welfare and Development (DSWD). The NFA is prohibited from selling rice directly in the open market, except under specific conditions such as aging and deteriorating stock quality, which can then be disposed of through auctions involving private buyers.
This restructuring has led to significant challenges. The NFA's inability to release rice stocks directly into the market has resulted in a substantial accumulation of rice in its warehouses. As of January 2025, reports indicate that NFA warehouses are holding approximately 300,000 metric tons of rice. In response, the Department of Agriculture (DA) is seeking a food crisis measure to allow the sale of these stocks without violating the law.
Critics argue that the RTL has inadvertently harmed the local rice industry. Consumers are now facing rice prices as high as P60 per kilogram, while farmers are compelled to sell their produce at prices as low as P16 per kilogram. This disparity has been attributed to the diminished role of the NFA in market intervention, which previously helped stabilize both consumer prices and farmer incomes.
In an effort to address rising rice prices, the DA announced a maximum suggested retail price (MSRP) of P58 per kilogram for imported rice, effective January 20, 2025.
Additionally, Agriculture Secretary Francisco Tiu Laurel Jr. stated that the full impact of a recent rice import tariff reduction—from 35% to 15%—is expected to be felt by January 2025, with projections of rice prices falling by P5 to P7 per kilogram.
Despite these measures, the RTL's implementation has sparked debates about its effectiveness and impact on the local rice industry. While the law aimed to ensure a stable rice supply and affordable prices through liberalized imports, it has also led to unintended consequences, such as the accumulation of rice stocks in NFA warehouses and challenges faced by local farmers in a more competitive market. As the government continues to navigate these issues, the balance between supporting local agriculture and ensuring consumer affordability remains a critical concern.
Ross is known as the Pambansang Blogger ng Pilipinas - An Information and Communication Technology (ICT) Professional by profession and a Social Media Evangelist by heart.
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