Soaring rice prices hurt poor families

DWINDLING SUPPLY Only a few sacks of rice remained in this National Food Authority warehouse in Quezon City in this photo taken in April, prompting its officials to import the staple from Thailand and Vietnam. —GRIG C. MONTEGRANDE

The chair of the Senate committee on agriculture has joined calls to abolish the state-run National Food Authority (NFA), as poor families reel from the uncontrolled surge in rice prices nationwide.

Sen. Cynthia Villar said the NFA did nothing to deal with the problems besetting the palay (unmilled rice) procurement program.

This allowed “manipulative rice traders, cartels and smugglers to do their thing with impunity,” Villar told reporters covering the 27th South Luzon Area Business Conference in Legazpi City on Saturday.

The escalating prices of the country’s main staple are prompting the poor to tell their children to stop attending classes because they can no longer afford rice for their food in school.

“Since the prices of rice have become expensive and my daily income is just P200, we cannot afford the rice,” said Alih Jumala, 48, a porter in Zamboanga City.

“We consume three kilos a day. My children don’t bring money to school. They bring food packs,” Jumala said.

He said he had asked his seven children to stop going to school “until prices go down.”

All-time highs

The NFA buys palay from farmers in the country and sets the volume of rice to be imported to ensure stable prices and supply of the staple. Its rice, usually the cheapest in the market, is patronized by the poor.

But last week, rice prices in Zamboanga City rose to P70 a kilogram after the NFA supply ran out, prompting the local government to declare a state of calamity.

Prices of rice in other parts of the country did not reach the levels in Zamboanga but rose to all-time highs after NFA stocks were depleted.

The surge in the prices of rice, along with other food items, helped push inflation upward to 5.7 percent nationwide and 6.5 percent in Metro Manila in July.

Food accounts for a big portion of a poor household’s budget.

Villar expressed dismay with the NFA, which is responsible for procuring palay directly from farmers to sustain supply and control prices at affordable levels.

Traders dictating prices

The senator said traders took advantage of the situation by manipulating and dictating the prices of palay.

Villar was reacting to complaints of farmers who had urged the NFA to lift the stringent policy on buying palay harvest (a moisture content level is set by the agency), forcing them to sell their harvest at prices set by traders.

The agency’s current buying price is pegged at P17 per kg for dry palay. Once milled, the rice is sold at P27 per kg for [the regular-milled] and at P32 per kg for the well-milled, Villar said.

As traders are allowed to manage the procurement of palay and later sell rice at their prices, the situation has created cartels and smugglers, she said.

End public subsidy

Last week, Sen. Sherwin Gatchalian called for the abolition of the NFA while Sen. Francis Pangilinan demanded that its administrator and other officials be dismissed.

Gatchalian said scrapping the NFA would end taxpayer subsidy of the “ineffective” agency. He noted that the NFA racked up losses of P150 billion in 2017.

Sen. Aquilino Pimentel III on Sunday said he was also seeking to dismantle the NFA so anyone could import rice as long as they pay a tariff.

Budget Secretary Benjamin Diokno had a more frightening message to top NFA officials. “They should be hanged,” he said at the Meet Inquirer Multimedia forum on Aug. 14.

Diokno said the officials had used the budget of the NFA not to buy rice but to pay off its debt, resulting in the sharp increases in rice prices.

Smuggling

Villar said the farmers’ concern had been brought to the Philippine Competition Commission, an independent, quasi-judicial body formed to deal with problems such as cartels, smuggling and economic sabotage.

“We have done our part to pass a bill against large-scale agricultural smuggling and economic sabotage, imposing nonbailable penalties to offenders,” she said. “It is for the law enforcers to implement the laws.”

Villar said the function and budget of the NFA would be transferred to an agency, which would handle the rice competitiveness enhancement fund.

It would also be tasked with solving the perennial problems that the NFA had failed to act on, she said.

Rice floods Zambo

The senator said P10 billion would be set aside to finance the rice competitiveness enhancement program aimed at making rice farmers more competitive and mechanizing rice production.

On Saturday, Agriculture Secretary Emmanuel Piñol declared that the rice crisis in Zamboanga City was over as traders from two neighboring province were supplementing the commercial rice to be sold at markets there.

Piñol said he had recommended an additional 203,000 bags of rice to be made available to Zamboanga, Basilan, Sulu and Tawi-Tawi to prevent the rice shortage from happening again.

Gov. Mujiv Hataman of the Autonomous Region in Muslim Mindanao said the provinces of Basilan, Sulu and Tawi-Tawi also suffered a rice shortage.

Tawi-Tawi used to be abundant in rice that came from Malaysia, Hataman said. Before its border was closed in early August, residents were paying P1,500 for a 50-kg bag of rice. But the price has risen to P2,200.

The Philippine Coast Guard (PCG) on Friday intercepted two vessels loaded with suspected smuggled rice in the waters off Basilan. It found a total of 22,000 packs of rice on board the ML Overseas and the ML Nadeepa.

Sen. Richard Gordon said he suspected that the rice crisis was the handiwork of people manipulating the situation to raise funds for the 2019 elections. —WITH REPORTS FROM TINA G. SANTOS AND CHRISTINE O. AVENDAÑO