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Focus on inputs, not imports

Philippine Daily Inquirer
First Posted 23:11:00 03/17/2011

Filed Under: business, Agriculture, Economic Indicators

WILL THERE be a rice crisis in 2011? (In October 2009, one was erroneously predicted to take place in 2010.) Should the Department of Agriculture and the National Food Authority (NFA) allow rice importation, more than what they have announced?860,000 metric tons (mt) by the NFA and 660,000 by the private sector?

Government rice import targets for 2011 appear to be not in unison?from 1.5 million metric tons (mmt) to 1.3 mmt, to 860,000 metric tons, reflecting a substantial drop (deemed a feat) from last year?s level of 2.5 mmt.

We had as of Jan. 1, 2011, a rice inventory of 3.4 mmt?the highest on record over a 30-year period (1980-2010). Prior to the lean months of July-September, our rice buffer stocks were placed by the Bureau of Agricultural Statistics (BAS) at 1.6 mmt in 1980; 1.4 mmt in 1990; 1.6 mmt in 2000; 2.2 mmt in ?crisis?-laden 2008; 2.8 mmt in 2009; and 3.3 mmt in 2010. Only in 1995 did our rice stocks decline (to 60 percent of normal levels) due to El Niño, but these bounced back the following year.

We Filipinos undoubtedly are a resilient people who can cope with abrupt staple production changes caused by destructive typhoons and unpredictable weather.

Discussions to raise import levels beyond what was declared are premature. After all, we have not finalized any quantity as yet; to base our decisions on looming price increases, instead of a basic need or domestic production would be faulty.

The country?s rice stocks?even assuming the first semester rice production remains at the same level as in El Niño-affected 2010 production?estimated at 2.4 mmt by June 30, would be sufficient for 79 days? consumption; and the stocks could even go higher, to 3 mmt, based on the agriculture department?s production goal for the March to May 2011 palay harvest season. That would lengthen our stock level to 97 days (until October, coinciding with the main harvest season).

On the related issue of food security, the Food and Agriculture Organization (FAO), in a March 8, 2011 publication (?FAO?s Initiative on Soaring Food Prices),? noted that price increases by 2017, compared to 2005-2007 levels, are expected as follows: for rice by 1 percent; wheat by 2 percent; maize by 15 percent; oilseeds by 35 percent; vegetable oils by 51 percent; and sugar by 11 percent.

Rice imports have dominated the government?s attention. We should move on to import-dependent inputs affecting food production: fertilizer, soybeans, corn, fish meal, wheat-flour, feed-wheat, sorghum.


Palanan, Makati City;


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