Gov’t sees rice prices to ease down to P29/k
The government seeks to bring down rice prices to P29 per kilo for low-income households following the approval of a tariff reduction on rice, chemicals, and coal briquettes to make these items more affordable.
Socioeconomic Planning Secretary Arsenio Balisacan said the Comprehensive Tariff Program for 2024-2028 was approved by the National Economic and Development Authority (NEDA) Board.
The program reduces tariff rates on rice imports to 15 percent for both in-quota and out-quota categories, down from the previous 35 percent.
“The Department of Agriculture is aiming for a reduction of P29 per kilo, at least for the poor, because we will complement this tariff reduction with the direct subsidies to the poor and vulnerable so that at least they could access the food, the P29-per-kilo rice,” Balisacan said.
The government will offer various forms of subsidies to help low-income families reach the P29 per kilo target, which includes discounted rice from the National Food Authority through Kadiwa centers.
Another option is via cash transfers channeled through the Pantawid Pamilyang Pilipino Program (4Ps) of the Department of Social Welfare and Development and expansion of the DSWD’s food stamp program.
Balisacan said the lower tariff rates will benefit all Filipinos, not just the poor, as this would counter rising global rice prices and prevent further inflation.
“Overall, with the tariff reduction from 35 to 15 percent, everybody will benefit from that. This is crucial, as I emphasized, because world prices are still increasing,” Balisacan said.
“If we don’t reduce the tariff, with the increasing world prices compounded by 35 percent tariff over and above that, prices and inflation will remain to be a very serious problem. So with this, we expect those upward pressures and rice prices to ease,” the NEDA chief added.
The tariff adjustment will take effect after an executive order is issued.
Based on the latest inflation report of the Philippine Statistics Authority in the past three months, rice contributed about two percentage points (or over 50 percent) to the headline inflation, Balisacan said.
The NEDA Board also approved the CTRM’s recommendation to reduce the tariff on certain chemicals and coal briquettes to improve energy security and reduce input costs.
“Tariff reduction on coal will help ensure its availability at reasonable prices, thus supporting more stable electricity prices and supply in the country” Balisacan said.
“Given our present energy constraints, this reduction will be timely as we steadily work toward implementing planned investments in transmission facilities and renewable energy infrastructure in the coming years,” he added.
Balisacan said the chemicals proposed for reduction are inputs to manufacture antiseptics, detergents, and medical research.
Reducing the tariff on these inputs will help lower production costs and improve consumer welfare, he said.
The reduced tariff rates on corn, pork, and mechanically deboned meat under last year’s Executive Order No. 50 were also maintained until 2028 to ensure a stable supply of these commodities and enhance food security.
The Department of Agriculture, for its part, said it emains confident in achieving its target of producing 20.44 million metric tons of palay this year, despite the challenges posed by El Niño.
“We’re optimistic since it’s still early June. We’re still aiming for that. We’re doing our best to achieve that,” said DA Undersecretary Chris Morales, who heads the Masagana Rice Industry Development Program.
The Philippines achieved a record-breaking palay harvest of 20.06 million metric tons in 2023, attributed partly to government interventions funded by tariffs collected on imported rice.
The Rice Tariffication Law allocates P10 billion through the Rice Competitiveness Enhancement Fund to mechanize rice farming and provide farmers with high-quality seeds and training on improved agricultural techniques.
Editor’s Note: This is an updated article. Originally posted with the headline NEDA says government is working on the possibility of selling rice at P29/kilo
