President’s price cap on rice seemed to have an effect on world market, says Speaker

Speaker Ferdinand Martin G. Romualdez and lawmakers, including Deputy Majority Leader Erwin Tulfo, Rep. Ambrosio Cruz, Jr., and Committee Chairman Mark Enverga, joined the Bureau of Customs to inspect rice warehouses in Bulacan amid rising price concerns. FILE PHOTO

MANILA, Philippines — It seems President Ferdinand Marcos Jr.’s order of a price cap on regular and well-milled rice had a worldwide effect, as his cousin, House Speaker Ferdinand Martin Romualdez, said that prices at the global market went down by 21 percent percent.

In a statement on Thursday, Romualdez said that the reduction in global market prices of rice can be attributed to Executive Order No. 39, or Marcos’ directive that regular milled rice would be sold at P41 per kilogram, and well-milled rice at P45 per kilogram.

“Siguro nung kinansel na nila [importers and traders] ang mga orders, biglang dumami tuloy ang stock sa abroad ng bigas,” Romualdez noted.

(Maybe the importers and traders cancelled their orders, leading to a bigger stock of rice abroad.)

Romualdez cited US-based Markets Insider, which supposedly showed that prices in the world market went down from $384 per metric ton last July to $332.4 per metric ton this month — a 21 percent decrease.

“It is proven that the EO 39 of President (Ferdinand) Bongbong R. Marcos Jr. set commendable results not only in our country, (but in the world as well). We are hoping na magtuloy-tuloy na ang pagbaba ng presyo ng bigas (We are hoping that the decrease in rice prices would continue),” the Speaker said.

Romualdez said that it also shows that they have been right all along — that the price increases for rice are artificial, and that supply was abundant as shown in the inspections that House members and the Bureau of Customs did.

“It is obvious na artificial ang pagsirit ng presyo ng bigas sa mga palengke natin dahil tinatago ‘yung mga bigas sa bodega as we have seen during our inspection,” he added.

(It is obvious that the spike in local market prices of rice is artificial because people have been hiding rice grains in warehouses, as we have seen during our inspection.)

Aside from Romualdez, House committee on ways and means chairperson and Albay 2nd District Rep. Joey Salceda said that the high volume of demand from the Philippines brought rice prices up — and the price cap ended the spike.

“We have seen this crisis before and we know how to deal with it,” Salceda, an economist by profession, said.

“Pero we should not over-import para hindi i-anticipate ng mga kapitbahay nating bansa at tumaas ng presyo ng bigas.  Ang paglalagay ng price cap ng Malacañang sa bigas ay nagpapakita na hindi katanggap-tanggap sa atin ang mga artificial na pagtaas ng presyo ng bigas sa world market,” he added.

(But we should not over-import so that our neighboring countries would not anticipate and eventually raise prices of rice.  Malacañang’s price cap on rice showed that it is unacceptable for us to see an artificial price spike on the world market.)

Marcos last August 31 signed E.O. No. 39, to counter the price increases.  According to the Presidential Communications Office, the price cap is aimed at countering the following factors:

• Illegal price manipulations like hoarding and industry collusion
• Global events outside the country’s control, such as the Russia-Ukraine conflict
• India’s rice export ban
• Capricious oil prices in the international market

However, the imposition of the price drew mixed reactions — as Senators Risa Hontiveros and JV Ejercito believe that stricter enforcement of laws, and not a mere price cap, would address hoarding.

READ: Marcos’ order to set price cap on rice draws mixed reactions from senators 

Members of the House’ Makabayan bloc and Agri party-list Rep. Wilbert Lee also warned that it might affect small retailers which do not have control over the production costs of rice — leading to low income for retailers or fewer rice being sold.

READ: Price cap on rice might hurt small retailers, Makabayan bloc says 

These concerns prompted Romualdez to allocate P2 billion from the country’s existing funds to help small retailers that would be affected by the order.

READ: Romualdez: P2-B in 2023 budget to be allocated for rice retailers affected by price ceiling 

JPV