DA goal: Cut rice prices to 2023 levels of P41-P45
Following its declaration of a food security emergency, the Department of Agriculture (DA) aims to further lower rice retail prices to July 2023 levels—P41 per kilogram for regular milled rice and P45 per kg for well-milled rice.
At the same time, the DA said the maximum suggested retail price (MSRP) for 5 percent broken imported rice in Metro Manila would also be slashed to P55 per kg starting Wednesday.
“And then by Feb. 15, the MSRP will now be nationwide,” Agriculture Assistant Secretary and DA spokesperson Arnel de Mesa told reporters in a briefing on Tuesday, adding that the DA plans to further reduce the MSRP in the coming weeks after a periodic review.
The DA imposed on Jan. 20 the MSRP for imported rice in public and private markets in the National Capital Region (NCR) to curb rising rice prices despite tariff cuts and the decline in global prices.
As of Feb. 1, the DA’s monitoring showed that public markets in NCR sold local regular milled rice from P37 to P46/kilo while local well-milled rice was priced from P40 and P55/kilo.
Addressing the “extraordinary” rise in retail prices of rice, subject to periodic reviews, was the main aim of the food security emergency declared on Monday by Agriculture Secretary Francisco Tiu Laurel Jr. through Department Circular No. 3.
“When we see that we are already meeting the objectives of this declaration, the agriculture secretary may lift it. Since this is an emergency, we want to resolve it as soon as possible,” De Mesa said.
No supply shortage
He clarified that the declaration was prompted by elevated retail rice prices, not a supply shortage.
Under the amended Rice Tariffication Law signed in December, the agriculture secretary is authorized to declare a food security emergency on rice due to supply shortages or extraordinary increases in prices, as recommended by the National Price Coordinating Council (NPCC), which includes the DA.
In its Jan. 14 resolution making the recommendation, the NPCC pointed to the “extraordinary increase in the price of rice when rice inflation has exceeded the upper bound target for food inflation and reached double.”
Constantly high
“Such a condition is considered to remain in place while rice prices have not returned close to the levels prior to the breach of the food inflation target,” it said.
Trade Assistant Secretary Agaton Teodoro Uvero explained that the basis of the NPCC recommendation was the situation in July 2023 when “prices increased and never … almost never declined.”
The NPCC cited data from the Philippine Statistics Authority (PSA) showing that rice prices “remain elevated,” with regular milled rice and well-milled rice priced at P48.51 per kg and P54.38 per kg, respectively.
“These price levels are 19 percent and 20 percent higher compared to the period before the price spikes in July 2023,” it added.
The emergency declaration also allows the National Food Authority (NFA) to sell its rice stocks to local governments, government-owned and -controlled corporations and other government agencies at P33 a kilo.
The rice stocks would be released to designated government offices through the Food Terminal Inc. and sold to consumers at P35 per kg.
Acting NFA Department Manager Roy Untiveros said they were hopeful the move would drive down rice prices although the agency would end up losing around P12 to P15 per kilo for selling the staple at discounted prices.
Assuming that 150,000 metric tons of its rice stockpile would be sold to the public, the NFA said it expects to lose from P1.8 billion to P2.25 billion while the emergency declaration was in effect.
Sought for comment, the Federation of Free Farmers believes traders would not match the selling price for NFA rice as they “cannot afford to lose money.”
“P41 to P45 may be the lowest possible price for regular milled and well-milled rice, but these will be for relatively poor quality or inferior grades of rice,” FFF national manager Raul Montemayor said in a Viber message.
