Senator Cynthia A. Villar vowed on Monday to go after smugglers and cartel members foisting speculations about a looming rice-supply shortage to jack up prices, despite ample rice stocks.
Villar, who chairs the Senate Committee on Agriculture and Food, said she intends to file a resolution this week to pave the way for an inquiry into the country’s rice situation and track down speculators.
The senator played down reports that the actual price of commercial rice rose by P2 to P3 per kilogram (kg), saying the production shortfall is only 5 percent of total demand.
“And we have determined something like 500,000 metric tons [MT], which the National Food Authority [NFA] is allowed to import. So, I don’t see where the problem is coming from,” Villar said.
She surmised that market speculations were likely created by “rice smugglers and rice cartels.”
“You know, we have many rice smugglers, as well as rice cartels. That is why, when there are rumors [about impending rice-supply shortage], you will think that they are spreading these speculations to create artificial demand,” Villar said. “Because, when people worry about shortage, they stock up; and when you stock up, it creates demand that impairs the law of supply and demand.”
She added this is the reason she is wary when hearing news about an impending supply shortage and tends to ask: “Is there a group behind it that wants to manipulate prices which is the reason these stories are coming out?”
Villar admitted that even as she is getting tired conducting inquiries on rice-supply shortage, she will file a resolution within the week authorizing the Senate Committee on Agriculture and Food to look into the matter.
This, even as Villar voiced frustration that, despite enactment of a law declaring large-scale agricultural smuggling as a non-bailable offense classified as economic sabotage, no one has been charged.
Villar said she has asked the Philippine Rice Research Institute to teach farmers to “produce more through better seeds and mechanization in order to supply rice at low prices and put an end to smuggling.”
She also debunked reports about a rice shortage in Marikina, saying the NFA is mandated to make sure that there is a buffer stock of rice supply “and they can do it in two to three days.”
“They can import every year and buy from local farmers at a definite price. That is why I am surprised at the reports. The NFA’s mandate is very clear, so why are we hearing these reports? If the NFA is doing its job, this should not happen,” Villar said even as she did not rule out the possibility that some quarters are “creating something like [an artificial] shortage so people will panic and buy more than they need.”
Rice prices
Data from the Philippine Statistics Authority (PSA) showed that, as of the third week of January, the average farm-gate price of paddy rose by 7.81 percent to P19.81 per kg, from the previous year’s P17.79 per kg. The figure is also slightly higher than the P19.06 per kg recorded in the second week of January.
On a monthly basis, PSA data indicated that the latest quotation was 1.34 percent higher than the P18.92 per kg recorded in the third week of December.
The average farm-gate price recorded during the period is higher than the NFA’s support price. The food agency attached to the Office of the President buys paddy from farmers at P17 per kg, depending on quality.
In a report, the PSA also said the average retail prices of well-milled rice and regular milled rice posted increments for the eighth consecutive week since December.
“The average retail price of well-milled rice at P42.42 per kg went up from the previous week’s level by 0.07 percent. Relative to the same period last year, it was also higher by 2.22 percent,” the PSA report read.
“At the retail trade, the average price of regular milled rice during the week at P38.45 per kg posted an uptick of 0.34 percent, from P38.32 per kg in the previous week. Compared to the same period a year ago, it also climbed by 3.58 percent,” it added.
Data from the PSA also showed that the wholesale price of well- milled rice rose by 3.24 percent to P39.54 per kg, from last year’s quotation of P38.30 per kg.
The wholesale price of regular milled rice as of the third week of January was pegged at P36.40 per kg, 5.51 percent higher than the P34.50 per kg recorded a year ago.
“The average wholesale price of regular milled rice at P36.40 per kg exhibited a price increase of 1.36 percent from the previous week’s level,” the PSA report read.
The NFA said earlier that the average farm-gate and retail price of rice usually goes up during the lean months, when the harvest of the staple declines significantly.
Farmers have already harvested their main crop. Harvest for the dry season crop would start in March.
The food agency cited the high buying price of commercial traders as the main reason behind its failure to increase its procurement of paddy from farmers last year.
Image credits: Nonie Reyes