The Philippine Star

A pivotal phase for Phl agricultur­e

A year and a half into the Marcos administra­tion, the Philippine agricultur­e sector is still on a tightrope in terms of balancing local food production and importatio­n of key commoditie­s.

With high input and retail costs coupled with the potential impact of El Niño, this balancing act seems like a tall order for President Marcos’ full-time successor, Agricultur­e Secretary Francisco Tiu Laurel, who was appointed last Nov. 3.

Marcos described Laurel as someone who has a “fair understand­ing” of “what needs to be done.” Before his appointmen­t to the Cabinet, he served as president of Frabelle Fishing Corp. – the world’s third largest tuna fishing company – from 1985 to Oct. 31 this year. His wealth of experience spans diverse industries, encompassi­ng fishing, meat and seafood processing, coldchain networks and aquacultur­e as well as shipbuildi­ng and repair, all of which he now brings to the DA.

With his extensive experience, some within the agricultur­e and fisheries sector are hopeful that Laurel will prioritize local production over resorting to importatio­n to ensure the country’s food security and affordabil­ity.

While some express support, others are eager to see the new agricultur­e chief demonstrat­e his worth and expertise beyond being one of the biggest campaign donors to President Marcos during his 2022 presidenti­al campaign.

Laurel was encouraged to reconsider liberaliza­tion policies that led to an influx of imported goods, emphasizin­g the need to uplift the morale and productivi­ty of local food producers.

But barely a month since his appointmen­t, the National Economic and Developmen­t Authority (NEDA) Board endorsed the extension of lower tariffs on key commoditie­s, such as rice, corn and pork, under Executive Order (EO) 10. President Marcos has approved the extension for another year.

The NEDA endorsemen­t aims to avoid the return of tariff rates to 30 percent in-quota and 40 percent out-quota for pork, to 40 percent in-quota and 50 percent out-quota for rice, and to 35 percent in-quota for corn by Jan. 1.

Presently, importers benefit from a 15 percent in-quota and 25 percent out-quota tariff rate for pork, a reduced tariff of 35 percent on imported rice, and a five percent in-quota tariff on corn until Dec. 31.

While importers are pleased with the prospect of an extended low tariff regime, local producers argue that they are on the losing end, as this endorsemen­t would only further encourage the importatio­n of rice, corn and pork.

“Despite our submission of hard data that demonstrat­e EO 10 did not significan­tly reduce retail prices of pork and rice, the economic managers remained steadfast in their ‘import more’ policy. President Marcos was likely misled with false or selective informatio­n and advice. The real winners are a few importers and traders,” Federation of Free Farmers (FFF) national manager Raul Montemayor said.

Last year, the Philippine­s once again overtook China as the world’s top rice importer, according to the United States Department of Agricultur­e (USDA). The Philippine­s had held the top spot in 2008, 2010 and again in 2019.

The USDA forecasts the Philippine­s to import 3.8 million metric tons (MT) of rice in the marketing year 20232024 (or from August 2023 to July 2024 in the US agency’s calendar).

Last year, the country shipped a record high 3.83 million MT of rice. As of Dec. 14, Philippine rice imports had already reached 3.22 million MT.

The DA anticipate­s a decrease in rice imports for the current year compared to the record high in the previous year, with production expected to reach another record performanc­e of 20 million MT. The highest palay production on record was attained in 2021, reaching an output of 19.96 million metric tons.

Despite the massive importatio­n of rice, retail prices of the staple continued to soar in public markets.

This led President Marcos, who was the agricultur­e chief at the time, to issue Executive Order 39 in September, imposing price caps of P41 per kilo for regular milled rice and P45 per kilo for well-milled rice.

The price caps, which were issued following the reported widespread illegal trade manipulati­on despite the staple food’s ample supply, were lifted in early October.

But based on the DA’s monitoring as of Dec. 21, the retail price of local regular milled rice still ranged between P38 and P52 per kilo; local well-milled rice, between P32 and P56 per kilo; local premium rice, between P50 and

P62 per kilo; and local special rice, between P54 and P68 per kilo.

The retail price of imported well-milled rice is P58 per kilo; imported premium rice, between P51 and P60 per kilo; and imported special rice, between P58 and P65 per kilo.

This is still a long way from the P20 per kilo campaign promise of President Marcos due to the uncertaint­ies in the world market. But this price point remains the aspiration of the Marcos administra­tion, Laurel said.

Meanwhile, the same case can be said with the local pork industry – retail prices have remained high while local producers struggled to match the price of low-priced imported pork, thereby affecting their productivi­ty.

The pork industry, which is still on the recovery path from the harsh impact of the African swine fever since 2019, said the continued implementa­tion of the reduced tariff did not translate to cheaper pork to consumers and further extending this would only result in uneven retail pricing of pork in the markets and discourage hog raisers.

“The local hog industry is disappoint­ed with the recent extension of EO 10 until the end of 2024. Importatio­n at reduced tariff for pork has always been the lazy solution of NEDA for almost four years now and it means another year of suffering for local producers. We are with the government to tame down inflation, but they should also make tangible efforts on improving local production,” Pork Producers Federation of the Philippine­s Inc. (ProPork) president Rolando Tambago said.

With a lot more problems faced by the agri-fishery sector, Laurel said “feeding 118 million Filipinos is a daunting yet ‘achievable goal’ with a wholeof-nation approach to the modernizat­ion of the long-neglected agricultur­e sector.”

Laurel said the DA would step up efforts to mechanize farming, build more agricultur­al infrastruc­ture and adopt latest technologi­es to boost the country’s food production and eventually address the importatio­n issue.

As per President Marcos’ directive, the push for agricultur­al modernizat­ion will focus on equally important sectors like rice, livestock, poultry, fisheries and high value crops to ensure that affordable food items are readily available and accessible to Filipino consumers.