Helping Filipino farmers

Last February, the Foreign Agriculture Service of the US Department of Agriculture projected that rice imports by the Philippines will reach as much as 2.9 million metric tons this year.

Our rice production simply cannot catch up with demand. The USDA forecasts our milled rice production at 12.4 million MT this year compared to consumption of 14.95 million MT.

Last year, Philippine rice imports reached 2.98 million MT.

While palay production increased last year, the Federation of Free Farmers revealed that only half of the incremental harvest came from an expansion in harvested area and only half was due to an improvement in yield. Output per hectare, it said, increased by only 1.6 percent in 2021.

The Philippines will remain as one of the top rice importers in the world, next to China and Bangladesh.

Attaining rice self-sufficiency remains an elusive dream.

Our country used to be self-sufficient in rice in 1975 to 1976. In fact, we were even exporting rice to our neighboring Asian countries like Indonesia, China and Myanmar in 1977 to 1978.

A number of factors, including a rapid increase in population, limited land resources, turned the Philippines into a net rice importer. And we have not managed to climb out of that deep hole yet.

Then came the Rice Tariffication Law which took effect in early 2019. It not only removed the power of the National Food Authority (NFA) to import and distribute cheaper rice, it also liberalized importation of rice into the country.

The RTL provided for the establishment of the Rice Competitiveness Enhancement Fund or RCEF, which is funded primarily by duties paid on imports. It was supposed to pipe in around P10 billion a year for the rice sector to be used for procurement of farm machinery and equipment, rice development, propagation and promotion, as well as expanded rice credit and extension services.

Rice tariffs are currently set at 35 percent on all rice imports from ASEAN countries, and 40 percent on those coming from non-ASEAN countries. But even with these seemingly prohibitive rates, rice imports are still cheaper than domestically produced rice.

Consumers are benefitting from cheaper rice because the price of rice imports pull down the prices of domestic rice.

But what about the 2.4 million palay farmers and workers?

So once again we are faced with choosing between short-term food security and rice self-sufficiency. Or is it really one or the other? Can’t we have both?

Our government already knows how to make our palay farmers competitive.

Low-cost irrigation, access to fertilizers and high-yielding varieties, farm-to-market roads, post-harvest facilities, capacity training, access to low-cost credit, higher budget for agriculture. Our government agriculture managers already know what needs to be done. Plans have been drawn up and implemented year after year but nothing seems to work.

According to the Philippine Statistics Authority (PSA), in 2018, farmer and fisherfolks posted the highest poverty incidence among the basic sectors at 31.6 and 26.2 percent, respectively.

The number of poor farmers in 2018 declined to 2.4 million from 3.7 million in 2015. Basically, Filipinos living and working in the countryside remained poorer compared to those in urban areas.

Meanwhile, according to IBON Foundation, the agriculture sector’s annual growth was only 2.1 percent on average in 2017 to 2019 and its share in the economy has reached its lowest in Philippine history at 7.8 percent of GDP in 2019. The sector even suffered 1.4 million job losses from 2017 to 2019, it added.

From 2017 to 2020, the sector grew by an annual average of just 1.6 percent, which is just a little over half the 2.9 percent average annual growth from 2001 to 2016. From 2017 to 2020, its annual average contribution to GDP was 9.8 percent, it noted.

IBON also revealed that rice import dependency ratio rose from five percent in 2016 to 20.2 percent in 2019 in the wake of the Rice Liberalization Law. The import dependency ratio also grew significantly over the same period in garlic (from 89.1 to 92.2 percent), potato (from 14.8 to 18.1 percent), beef (32.7 to 40.3 percent), tuna (3.7 to 17 percent), pork (10.6 to 12.9 percent), and galunggong (0.4 to 21.9 percent).

It added that the country also had a $7.7-billion average annual agricultural trade deficit in 2018 to 2020, the largest three-year deficit in the last four decades.

It said that the poverty incidence among farmers (31.6 percent) and fisherfolk (26.2 percent) is much higher than the national average of 16.7 percent. From 2017 to 2020, an average of 328,000 agricultural jobs were long, which is the worst among the last six administrations.

No wonder nobody wants to become a small-scale farmer in the Philippines.

In Vietnam, the agriculture, forestry and fishing sector accounted for 12.36 percent of GDP, compared to 14.85 percent in 2010 and a high of 19.57 percent in 2011. The decreasing GDP contribution of the sector, however, was due to the growing significance of Vietnam’s industry and service sectors.

Vietnam has transformed from a net importer to a net exporter of agricultural products after its trade liberalization and agriculture reforms in the 1980s. It has become one of the leading producers and exporters of many commodities including rice. In 2021, its rice output reached 43.86 million tons, up by 1.1 million tons compared to the previous year.

According to Vietnam’s Ministry of Agriculture, although the cultivated area decreased by about 39,700 hectares, the yield increased by nearly 1.9 quintals per hectare compared to 2020 to fully meet the demand for domestic consumption, use as animal feeds, and export.

In the first four months of last year, the Philippines sourced 84 percent of its rice imports from Vietnam.

Since 1990, our country has been home to the International Rice Research Institute (IRRI). Our Philippine Rice Research Institute has been in collaboration with IRRI for most of its rice research and training projects in the Philippines.

Vietnam, which contributes more than six percent of global rice production, has thanked IRRI for helping increase the productivity and profitability of Vietnamese farmers.

Why are our farmers not benefitting from hosting IRRI in the country? What have we been doing wrong?

Incoming President Bongbong Marcos can create a lasting legacy by attaining something that his predecessors have not for decades – rice self-sufficiency. But he should start by appointing someone in the Department of Agriculture who can help make this happen.

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