THE Philippines will void all unused import clearances for some 1.8 million metric tons (MMT) of rice issued last year to protect local planters who will harvest their crop starting next week.
Agriculture Secretary William D. Dar on Monday also announced that the Bureau of Plant Industry (BPI) will no longer issue sanitary and phytosanitary import clearances (SPS-ICs) to farmers’ organizations that serve as dummies of unscrupulous traders.
Dar made an assurance that invalidating SPS-ICs issued in 2019 will not cause a shortfall in rice supply, as the Philippines has stocks sufficient for at least three months. Apart from this, he said 175,000 metric tons (MT) of imported rice entered the country in January.
“We will void unused SPS-ICs because we have rice inventory good for 90 to 94 days. Plus harvest is coming,” he told reporters in an interview.
The chief of the Department of Agriculture (DA) said he has instructed BPI Executive Director George Culaste to find out why there are still unused SPS-ICs, some of which were issued a few months after the effectivity of the rice trade liberalization law (RTL).
He added the government may indicate an expiration date for the SPS-ICs to force traders to bring rice into the Philippines within a specified period of time.
Data from the BPI, an attached agency of the DA, showed that there were some 1,752 unused SPS-IC at the end of 2019. The BPI issued a total of 4,069 SPS-ICs from March 5 to December 31, 2019, for 3.63 MMT of imported rice.
The agriculture chief urged traders to desist from applying for SPS-ICs during harvest so as not to depress the farm-gate price of unhusked rice. He said the BPI may approve fewer SPS-ICs during harvest.
The enactment of Republict Act 11203, or the rice trade liberalization law, deregulated the rice industry and eased import requirements. Under the law, traders must secure SPS-ICs from the BPI prior to purchasing imported rice.
Schemes
Dar also said the government will stop issuing SPS-ICs to farmers’ cooperatives and associations that serve as dummies of unscrupulous rice traders and importers.
“We don’t want farmers’ cooperatives to be used [by unscrupulous traders] That’s a bad practice. We will not allow that. We have the list and once they come forward, we will not give them the clearance,” he said.
The DA earlier disclosed that it has identified the farmers’ organizations, particularly cooperatives, that are being used by unscrupulous traders who want to take advantage of the tax exemption privileges of coops.
Dar said the DA will strengthen its partnership with the CDA in weeding out these cooperatives.
He said he will request the CDA to submit all the financial statements of all registered cooperatives in the past three years to determine if they are capable of importing rice.
Cooperatives, farmers’ groups and associations edged out companies and traders in terms of rice imports under the new trade regime, as they cornered a total of 1 MMT of the staple at the end of 2019.
BPI data obtained and analyzed by the BusinessMirror showed that at least 120 multipurpose and farmers’ cooperatives, organizations and irrigators’ associations imported 1.043 MMT from March 5 until December 31, 2019.
The volume imported by farmers’ organizations was 28 percent higher than the 810,548.85 MT of rice imported by the 96 traders, rice millers and corporations, which included the likes of Puregold Price Club Inc. and Davao-based firm Davao San-Ei Trading Inc.
Documents obtained by the BusinessMirror showed a discrepancy between the financial capacity of some irrigators’ associations and the volume of rice they are importing (See “Farmer groups ‘top rice importers’–are they?,” in the BusinessMirror, November 21, 2019).
Image credits: Nonie Reyes