1 Philippine Rice Industry Briefer-1

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Philippine Rice Industry

RICE COMPETITIVENESS ENHANCEMENT FUND


“ If we did not have rice, our
deepest comfort food, we would


probably feel less Filipino.
- Doreen Fernandez

Photo Source: https://omf.org/uk/wp-content/uploads/sites/15/2017/03/philippines-1195394_1920.jpg?x76284


RICE COMPETITIVENESS ENHANCEMENT FUND
https://themarketmogul.com/wp-content/uploads/2015/02/business-257911_1920.jpg RICE COMPETITIVENESS ENHANCEMENT FUND
https://www.imdb.com; cinemalaya2014.blogspot.com; cinemarathon.blogspot.com RICE COMPETITIVENESS ENHANCEMENT FUND
“ Palay na ang
lumalapit sa
manok…

https://unsplash.com/photos/EMKmxch8h_c
RICE COMPETITIVENESS ENHANCEMENT FUND
https://unsplash.com/photos/sedJnjrUMM8

RICE COMPETITIVENESS ENHANCEMENT FUND


N L I !
U
https://2.bp.blogspot.com/-Uy8UoOhIyyU/Wqy9n2UgHvI/AAAAAAAB0YM/tLt4YxPOER4eqm-1IvWVXvY4MArGZqbuACLcBGAs/s1600/PM1.jpg ; https://ya-webdesign.com/images/rice-png-4.png

RICE COMPETITIVENESS ENHANCEMENT FUND


a n i n,
ma y k
B
S
asta
OG !
B U

RICE COMPETITIVENESS ENHANCEMENT FUND


RICE COMPETITIVENESS ENHANCEMENT FUND
Walang kwenta.

Buti pa sa ibang
bansa, maraming
Kawawa tayo.
ayuda ang
naibibigay sa mga
magsasaka!

Kulang kasi ang


binibigay na suporta
sa mga magsasaka!!!
Mabuti pa yung
iba!

RICE COMPETITIVENESS ENHANCEMENT FUND


11

Ang bigas ay nasa 20% ng


kabuuang konsumo ng mga
mahihirap o 9% ng average na
Pilipino.

RICE COMPETITIVENESS ENHANCEMENT FUND


4 cups
of cooked rice per day per person =

~110 kg
of milled rice per year per person (2015-
2016)

https://www.freshpack.fr/wp-content/uploads/2015/09/TIMBALE-DE-RIZ-CUISINÉS_Thai-Tapas-2-Freshpack-1024x680.jpg RICE COMPETITIVENESS ENHANCEMENT FUND


Gaano ba karami
ang inaaning
palay sa
Pilipinas?

Palayman,
ang inyong kasama
sa pagtuklas ng
mga kasagutan
tungkol sa
pagpapalay!
RICE COMPETITIVENESS ENHANCEMENT FUND
© PhilRice Photos

2018, PHILIPPINES
Dry Palay Production

19,066,094 tons

Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
© PhilRice Photos

2018, PHILIPPINES
Dry Palay Production

19,066,094,000 kg

Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
© PhilRice Photos

2018, PHILIPPINES
Dry Palay Production

381,321,879 bags
@50kg/bag

Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
https://million-wallpapers.com/newTab/

317,768
40’ ft. container trucks
1,200 bags per container trucks

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES

2018 Dry Palay Production


M mt
20 19.07
18
All
16
14.35 Irrigated
14
Rainfed
12

10

6
4.72
4

0
2018 2018 2018 Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
LEGEND:

2018 Dry Palay


Production (mt)

Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
TOP 20
Production
Rank Province
(mt)
1 Nueva Ecija 1,886,709
2018 Dry Palay 2 Isabela 1,188,584
Production (t) 3 Pangasinan 1,077,039
4 Iloilo 939,332
5 Cagayan 832,941
LEGEND:
6 Camarines Sur 689,722
7 Tarlac 568,862
8 North Cotabato 523,959
9 Leyte 486,878
10 Negros Occidental 486,038
11 Bukidnon 470,174
12 Oriental Mindoro 435,709
13 Maguindanao 433,197
14 Pampanga 432,172
15 Sultan Kudarat 430,996
16 Zamboanga del Sur 411,532
17 Occidental Mindoro 374,223
18 Palawan 367,032
Source: PSA 19 Bulacan 365,689
20 South Cotabato 348,806
RICE COMPETITIVENESS ENHANCEMENT FUND
Google Map Screenshot

2018, PHILIPPINES
Area Harvested

4,800,406 ha
Philippines

Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
Google Map Screenshot

2018, PHILIPPINES 22

Area Harvested

333, 177 ha
Nueva Ecija

Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
PHILIPPINES
2018 Area Harvested
M ha

5 4.80

4 All

3.29 Irrigated

3 Rainfed

2
1.51

0
2018 2018 2018 Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
LEGEND:

2018 Area
Harvested (ha)

Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
TOP 20
Rank Province Area (ha)
1 Nueva Ecija 333,177
2018 Area 2 Iloilo 292,111
Harvested (ha) 3
4
Isabela 281,326
253,005
Pangasinan
5 Cagayan 196,168
LEGEND: 6 Camarines Sur 179,100
7 Maguindanao 154,026
8 Tarlac 130,935
9 North Cotabato 127,130
10 Negros Occidental 126,200
11 Leyte 119,294
12 Sultan Kudarat 118,074
13 Capiz 114,648
14 Oriental Mindoro 106,676
15 Bukidnon 98,499
16 Palawan 95,062
17 Zamboanga del Sur 93,886
18 Pampanga 91,078
19 South Cotabato 90,786
Source: PSA 20 Occidental Mindoro 87,984

RICE COMPETITIVENESS ENHANCEMENT FUND


https://www.vecteezy.com/vector-art/183860-basketball-court

16
RICE COMPETITIVENESS ENHANCEMENT FUND
© PhilRice Photos

PHILIPPINES
2018 Dry Palay Yield

Dry (14%MC):
19.07 M mt
= 3.97 tons/ha
= 3,972 kg/ha
= 79 bags/ha

RICE COMPETITIVENESS ENHANCEMENT FUND


© PhilRice Photos

PHILIPPINES
2018 Dry Palay Yield

Fresh (22%MC): Dry (14%MC):


21.04 M mt 19.07 M mt
= 4.40 tons/ha = 3.97 tons/ha
= 4,400 kg/ha = 3,972 kg/ha
= 88 bags/ha = 79 bags/ha

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES
2018 Dry Palay Yield

mt/ha

5
4.37 All
3.97
4 Irrigated

3.12 Rainfed
3

0
Source: PSA
RICE COMPETITIVENESS ENHANCEMENT FUND
LEGEND:

2018
Yield (mt/ha)

RICE COMPETITIVENESS ENHANCEMENT FUND


TOP 20
2018 Rank Province
1 Nueva Ecija
Yield (mt/ha)
5.66
Yield (mt/ha) 2 Davao del Sur 5.09
3 Bukidnon 4.77
4 Laguna 4.75
LEGEND: 5 Pampanga 4.75
6 Biliran 4.50
7 Lanao del Norte 4.50
8 Davao Oriental 4.47
9 Kalinga 4.46
10 Zamboanga del Sur 4.44
11 Compostela Valley 4.44
12 Bulacan 4.43
13 Davao del Norte 4.43
14 Nueva Vizcaya 4.38
15 Camarines Norte 4.36
16 Tarlac 4.34
17 Bataan 4.29
18 Ilocos Norte 4.26
19 Misamis Occidental 4.26
20 Pangasinan 4.26

RICE COMPETITIVENESS ENHANCEMENT FUND


© PhilRice (Drawn by Irish Duran)

RICE COMPETITIVENESS ENHANCEMENT FUND


Kinukulang nga
ba tayo?

RICE COMPETITIVENESS ENHANCEMENT FUND


1.5kg 1 kg
Dry Palay = Milled rice
(14% MC) (65.4% milling recovery)

https://www.videoblocks.com/video/raw-rice-rotating-on-the-white-table-with-white-seamless-background-m3tbdzu
RICE COMPETITIVENESS ENHANCEMENT FUND
https://www.videoblocks.com/video/raw-rice-rotating-on-the-white-table-with-white-seamless-background-m3tbdzu

19.07 M mt
(Dry palay)

~12.47 M mt
(Milled rice @ 64.5% MR)
RICE COMPETITIVENESS ENHANCEMENT FUND
PHILIPPINES
2018 Total Use

14.17 M mt

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES
2018 Total Use Breakdown
2% 6%
4%

Seeds
Feeds and Waste
Processing
Food

88%

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES
2018 Sources of Rice Supply

Total Use
14.17
M mt
RICE COMPETITIVENESS ENHANCEMENT FUND
PHILIPPINES 39

2018 Sources of Rice Supply

Production
12.47
M mt
Total Use
14.17
M mt
RICE COMPETITIVENESS ENHANCEMENT FUND
PHILIPPINES 40

2018 Sources of Rice Supply

Import
1.70
M mt

Production
12.47
M mt
Total Use
14.17
M mt
RICE COMPETITIVENESS ENHANCEMENT FUND
PHILIPPINES 41

2018 Sources of Rice Supply


Net Reserved
0.26
M mt

Import
1.70
M mt

Production
12.47
M mt
Total Use
14.17
M mt
RICE COMPETITIVENESS ENHANCEMENT FUND
© PhilRice Photos

RICE COMPETITIVENESS ENHANCEMENT FUND


2018
Rice Surplus and
Deficit by province (mt)

RICE COMPETITIVENESS ENHANCEMENT FUND


Cagayan
Pangasinan
Isabela

Nueva Ecija
2018
Rice Surplus (mt)

Davao del Sur

RICE COMPETITIVENESS ENHANCEMENT FUND


2018
Rice Deficit (mt)

Rizal

Cavite
Laguna
Cebu
Batangas

RICE COMPETITIVENESS ENHANCEMENT FUND


Bakit nga ba tayo
kinukulang sa
bigas?

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES 47

Why can’t we produce enough?


M ha
50
45
1 Smaller land suitable for rice 44
40
farming (area harvested, 2017)
35
31
30
25
20
16
15
11
10 8
5
5
0
Philippines Viet Nam Thailand Indonesia China India

RICE COMPETITIVENESS ENHANCEMENT FUND


Screenshot from Google Earth

Philippines is an archipelago.

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES 49

Why can’t we produce enough?


Person/ha
50
46
45
2 More people to feed (Ratio of
40
population to area harvested, 2017)
35
31
30
25 22
20 17
15 12
10
7
5
0
Thailand Viet Nam Indonesia Philippines India China

RICE COMPETITIVENESS ENHANCEMENT FUND


http://more-fun-philippines.blogspot.com/2012/04/palawan-philippines.html

50

RICE COMPETITIVENESS ENHANCEMENT FUND


RICE COMPETITIVENESS ENHANCEMENT FUND
https://upload.wikimedia.org/wikipedia/commons/7/7c/Mekong_river_basin.png

Why can’t we
produce enough rice?

3 Geography and resource


endowments

• Rice exporting countries are part of


mainland Asia and have huge river deltas
• Island nations are usually rice importer
• PH bears brunt of typhoons

Source: Dawe et al., 2006

RICE COMPETITIVENESS ENHANCEMENT FUND


http://blogs.discovermagazine.com/imageo/files/2014/12/Hagupit.jpeg

20
Typhoons annually
RICE COMPETITIVENESS ENHANCEMENT FUND
RICE COMPETITIVENESS ENHANCEMENT FUND
https://www.videoblocks.com/video/raw-rice-rotating-on-the-white-table-with-white-seamless-background-m3tbdzu

1.5kg 1 kg
Dry Palay = Milled rice
(14% MC) (65.4% milling recovery)

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES 56

Dry Palay Price


P/KG
DRY PALAY PRICE
45

40

35

30

25
20.07
20 18.21
15 14.13
10

0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES 57

Rice Price Comparisons

P/KG DRY PALAY PRICE WHOLESALE PRICE


Regular milled rice
45
40 36.78
34.62
35
30 27.12
25
20.07
20 18.21
15 14.13
10
5
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES 58

Rice Price Comparisons

P/KG DRY PALAY PRICE WHOLESALE PRICE RETAIL PRICE


Regular milled rice Regular milled rice
45
38.93
40 37.15
35 36.78
29.38 34.62
30
25 27.12
20.07
20 18.21
15 14.13
10
5
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

RICE COMPETITIVENESS ENHANCEMENT FUND


© PhilRice Photos

RICE COMPETITIVENESS ENHANCEMENT FUND


Paano ang nagiging
presyuhan ng palay?
Mababa ba talaga?

RICE COMPETITIVENESS ENHANCEMENT FUND


Unit Cost (Irrigated Ecosystems)
Quezon Lanao del Sur Zamboanga del Norte
Western Samar Laguna
Cost/kg Northern Samar Antique Davao del Sur
(Dry Bohol Bukidnon Albay
Leyte Agusan del Norte Pangasinan
Palay) Iloilo Camarines Sur Bulacan
Kalinga Negros Occidental Agusan del Sur
Ilocos Norte Capiz Davao Oriental
Zamboanga Sibugay Cagayan
PHILIPPINES PhP 14.38
North Cotabato Oriental Mindoro Aurora
Nueva Vizcaya South Cotabato Occidental Mindoro
Tarlac Isabela Compostela Valley
Maguindanao Pampanga Apayao
Davao del Norte Zamboanga del Sur Nueva Ecija
Palawan Sultan Kudarat

Source: RBFHS 2016-2017


RICE COMPETITIVENESS ENHANCEMENT FUND
Unit Cost (Rainfed Ecosystems)
Northern Samar Lanao del Sur Nueva Vizcaya
Cost/kg Western Samar Davao del Norte Bukidnon
(Dry Bohol Albay Leyte
Palay) Quezon Kalinga

PHILIPPINES PhP 17.58

Laguna Antique Isabela


Iloilo Cagayan Bulacan
South Cotabato Capiz Zamboanga del Sur
Zamboanga del Norte Agusan del Norte Tarlac
Sultan Kudarat Zamboanga Sibugay Aurora
Camarines Sur Negros Occidental Ilocos Norte
Agusan del Sur North Cotabato Pangasinan
Oriental Mindoro Maguindanao Pampanga
Occidental Mindoro Palawan Nueva Ecija
Apayao Compostela Valley

Source: RBFHS 2016-2017


RICE COMPETITIVENESS ENHANCEMENT FUND
Unit Cost (All Ecosystems)
63

Quezon Ilocos Norte Camarines Sur


Cost/kg Northern Samar Laguna Albay
(Dry Western Samar Bukidnon Agusan del Norte
Bohol Davao del Norte Negros Occidental
Palay) Lanao del Sur Zamboanga del Norte Capiz
Leyte Antique Davao del Sur
Kalinga Zamboanga Sibugay Agusan del Sur
Iloilo
PHILIPPINE PhP 15.00
S Pangasinan Palawan Pampanga
Cagayan Oriental Mindoro Compostela Valley
Davao Oriental Tarlac Zamboanga del Sur
North Cotabato Sultan Kudarat Aurora
Nueva Vizcaya South Cotabato Apayao
Bulacan Occidental Mindoro Nueva Ecija PhP 12.41
Maguindanao Isabela

Source: RBFHS 2016-2017


RICE COMPETITIVENESS ENHANCEMENT FUND
Bakit mataas ang
puhunan ng palay?

RICE COMPETITIVENESS ENHANCEMENT FUND


65

PhP 12.41/kg

Dry Palay
Production Cost/kg in
Nueva Ecija

Source: Benchmarking
Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 66

Dry Palay
Production Cost/kg in
Nueva Ecija

Source: Benchmarking
Fertilizer 1.94
Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 67

Dry Palay
Production Cost/kg in
Nueva Ecija

Pesticide 0.36

Source: Benchmarking
Fertilizer 1.94
Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 68

Dry Palay
Production Cost/kg in
Nueva Ecija

Hired Labor 3.76

Pesticide 0.36

Source: Benchmarking
Fertilizer 1.94
Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 69

Dry Palay Operator, Family, & Exchange


0.66
Production Cost/kg in Labor
Nueva Ecija
Hired Labor 3.76

Pesticide 0.36

Source: Benchmarking Fertilizer 1.94


Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 70

Animal, Machine, Fuel, & Oil


1.73
Dry Palay
Operator, Family, & Exchange
Production Cost/kg in Labor
0.66
Nueva Ecija
Hired Labor 3.76

Pesticide 0.36

Source: Benchmarking
Fertilizer 1.94
Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 71

Irrigation 0.45
Animal, Machine, Fuel, & Oil 1.73
Operator, Family, & Exchange
Dry Palay Labor
0.66

Production Cost/kg in
Nueva Ecija Hired Labor 3.76

Pesticide 0.36

Source: Benchmarking
Fertilizer 1.94
Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 72

Land Rent 2.11

Irrigation 0.45
Animal, Machine, Fuel, & Oil
1.73
Dry Palay Operator, Family, & Exchange
0.66
Labor
Production Cost in
Nueva Ecija
Hired Labor 3.76

Pesticide 0.36

Source: Benchmarking
Fertilizer 1.94

Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 73

Interest on Capital 0.43

Land Rent 2.11

Irrigation 0.45
Animal, Machine, Fuel, & Oil 1.73
Dry Palay Operator, Family, & Exchange
0.66
Production Cost/kg in Labor

Nueva Ecija
Hired Labor 3.76

Pesticide 0.36

Source: Benchmarking
Fertilizer 1.94
Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 74

Others 0.40
Interest on Capital 0.43

Land Rent 2.11

Irrigation 0.45
Animal, Machine, Fuel, & Oil 1.73
Operator, Family, & Exchange
Dry Palay Labor
0.66
Production Cost/kg in
Nueva Ecija Hired Labor 3.76

Pesticide 0.36

Source: Benchmarking
Fertilizer 1.94
Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
PhP 12.41/kg 75

Others 0.40
Interest on Capital 0.43

Land Rent 2.11

Irrigation 0.45
Dry Palay
Production Cost/kg in Animal, Machine, Fuel, & Oil
1.73
Nueva Ecija Operator, Family, & Exchange
0.66
Labor
2017 DS
Hired Labor 3.76

Pesticide 0.36

Source: Benchmarking
Fertilizer 1.94
Project
Seed 0.58
RICE COMPETITIVENESS ENHANCEMENT FUND
Nueva Ecija
Item
DS 2017 WS 2016 2013
Seed 0.72 0.55 0.58
Fertilizer 1.47 1.25 1.94
Pesticide 0.31 0.34 0.36
Hired Labor 3.72 2.97 3.76
Operator, Family, and Exchange Labor 0.43 0.43 0.66
Animal, Machine, Fuel and Oil 0.09 0.12 1.73
Irrigation 0.25 0.20 0.45
Land rent 1.60 1.44 2.11
Interest on Capital 0.16 0.26 0.43
Others 0.35 0.33 0.40
Total Cost/kg 9.11 10.38 12.41

RICE COMPETITIVENESS ENHANCEMENT FUND


Puhunan P12.41,
benta ______, luge?

Mura nabibili ng mga


trader/ miller/ wholesaler/
retailer, bakit ang mahal pa
rin ng bigaaas!?

RICE COMPETITIVENESS ENHANCEMENT FUND


PHILIPPINES
Rice Market Prices (P/kg)

Farmer Palay Trader Miller-trader Wholesaler Retailer

Product Fresh Palay Dry Palay Milled Rice Milled Rice Milled Rice

Cost 11.26 18.09 32.02 35.74 37.44

Selling 15.59 18.59 34.31 36.32 38.52

Profit 4.33 0.50 2.29 0.58 1.08

Nueva ecija (Dry Palay Cost) = PhP 12.41/kg


Source: Rice Value Chain Project RICE COMPETITIVENESS ENHANCEMENT FUND
Sample computation

79 bags/ha @ 2000 bags @


Farmer Palay Trader
50 kg/bag 50 kg/bag

Product Fresh Palay 3, 950 kg Dry Palay 100,000 kg

Cost 11.26 44,477 18.09 1,809,000

Selling 15.59 61,580 18.59 1,859,000

Profit 4.33 17,103 0.50 50,000

Source: Rice Value Chain Project


RICE COMPETITIVENESS ENHANCEMENT FUND
Sample computation

79 bags/ha @ 2,000 bags @


Farmer Miller-trader
50 kg/bag 50 kg/bag

Product Fresh Palay 3, 950 kg Dry Palay 100,000 kg

Cost 11.26 44,477 32.02 3,202,000

Selling 15.59 61,580 34.31 3,431,000

Profit 4.33 17,103 2.29 229,000

Source: Rice Value Chain Project RICE COMPETITIVENESS ENHANCEMENT FUND


Sample computation

79 bags/ha @ 1,000 bags @


Farmer Wholesaler
50 kg/bag 50 kg/bag

Product Fresh Palay 3, 950 kg Milled Rice 50,000 kg

Cost 11.26 44,477 35.74 1,787,000

Selling 15.59 61,580 36.32 1,816,000

Profit 4.33 17,103 0.58 29,000

Source:
RICE COMPETITIVENESS Rice Value Chain FUND
ENHANCEMENT Project
PHILIPPINES
Rice Market Prices (P/kg)

Farmer Palay Trader Miller-trader Wholesaler Retailer

Product Fresh Palay Dry Palay Milled Rice Milled Rice Milled Rice

Cost 11.26 18.09 32.02 35.74 37.44

Selling 15.59 18.59 34.31 36.32 38.52

Profit 4.33 0.50 2.29 0.58 1.08

Source: Rice Value Chain Project


RICE COMPETITIVENESS ENHANCEMENT FUND
PHILIPPINES 83

Total Profit Distribution


Farmer Palay Trader Miller-trader
Retailer Wholesaler

7%
12% HUH!?

49%

26%

6%

RICE COMPETITIVENESS ENHANCEMENT FUND


Sabay pasok ng tariff
na ’yan? Ano ba kasi
ang tariff na ’yan?

RICE COMPETITIVENESS ENHANCEMENT FUND


QR
MAV
?
Tariff
RA 11203
RICE COMPETITIVENESS ENHANCEMENT FUND
https://filipinotimes.net/wp-content/uploads/2017/04/Rice.jpg

QR (Quantitative Restrictions) are limits


to the amount of goods that may be
imported into the country.

RICE COMPETITIVENESS ENHANCEMENT FUND


https://newsinfo.inquirer.net/files/2019/02/17rice.jpg

MAV (Minimum Access Volume) -


volume or quantity of a specific
agricultural commodity that may be
imported with a lower tariff

RICE COMPETITIVENESS ENHANCEMENT FUND


https://www.topgear.com.ph/news/motoring-news/roadwork-schedule-nlex-sctex-a2578-20181001

TARIFF
Tariffs are taxes imposed by government
on goods

RICE COMPETITIVENESS ENHANCEMENT FUND


https://www.topgear.com.ph/news/motoring-news/roadwork-schedule-nlex-sctex-a2578-20181001

89

TARIFF
QR, out! Tariff, in?
RICE COMPETITIVENESS ENHANCEMENT FUND
Outside MAV

MAV
(350,000 mt)

Within MAV

RICE COMPETITIVENESS ENHANCEMENT FUND


STORY & TIMELINE 91

Rice Tariffication
The Philippines secured
a “Special Treatment”
for rice for 10 years
(1995-2005). Philippines allows
Extension of the Lapsed “Waiver” to
QR up to 2012 fulfil WTO obligation
to finally shift from
QRs on rice to tariff

1996 2012 2019


1995 2005 2017
QR to tariffs “Waiver” to QRs on rice to
(except rice) RA again extend the be converted
8178. QR on rice up to into tariffs
June 30, 2017.

RICE COMPETITIVENESS ENHANCEMENT FUND


https://thecurionomist.wordpress.com/2015/04/29/expanding-sri-lankas-trade-with-india-winning-with-competition-or-cowering-under-protection/

92

Republic Act No. 11203


RICE COMPETITIVENESS ENHANCEMENT FUND
Republic Act
11203

An Act Liberalizing the Importation, Exportation and


Trading of Rice Lifting for the Purpose the Quantitative
Import Restriction on Rice, and for Other Purposes

RICE COMPETITIVENESS ENHANCEMENT FUND


Republic ActNo. 11203
Salient Points

Tariffication
Quantitative restriction on imported rice is replaced with
tariffs

35% tariff for imports from ASEAN-member countries; 40%


within the 350,000 mt MAV; 180% from non-ASEAN
countries outside MAV

RICE COMPETITIVENESS ENHANCEMENT FUND


Republic ActNo. 11203
Salient Points

NFA’s functions
Buffer stocking for emergency situations and calamities (15-30
days worth), to be purchased from local farmers

Other functions are repealed (e.g. regulatory functions,


importation, commercial stocks survey, commercial
procurement).

RICE COMPETITIVENESS ENHANCEMENT FUND


Kaya na ba nating
makipagsabayan sa
ibang bansa?

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“Competitiveness
rests on the ability of
an entity to produce
products at the same
or superior quality
and at a lower cost
than its local or
international
competitors”

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PHILIPPINES 98

Imported Rice Price Estimate


Item Average (P/kg)
FOB price of 25% broken 18.24
+ Freight Cost 1.69
+ Surveyor’s Fee 0.05 As of ___________,
+ Insurance Cost 0.26
the average
wholesale price of
+ Integrated Cargo Handling Costs 1.56
local regular-milled
Landed Cost of Imported Rice (CIF) 21.80 rice is __________.
+ Tariff payment (35%) 7.63
+ Estimated transport cost 1.40
Price at Wholesale Market (Import Parity Price) 30.83

Source: Various, 2018


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Bakit ba hindi tayo
makasabay?

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C O M PA R I S O N 100

Cost of Rice Production


Costs (P/kg) Nueva Ecija, Philippines Suphan Buri, Thailand Can Tho, Vietnam
Seed 0.58 1.12 0.44
Fertilizer 1.94 1.56 1.36
Pesticide 0.36 0.90 0.87
Hired Labor 3.76 0.66 0.46
Operator, Family, and Exchange Labor 0.66 0.65 0.81
Animal, Machine, Fuel and Oil 1.73 1.66 0.81
Irrigation 0.45 0.14 0.08
Land rent 2.11 1.89 1.49
Interest on Capital 0.43 0.07 0.08
Others 0.40 0.20 0.13
Total Cost/kg 12.41 8.85 6.53

Source: Benchmarking Project RICE COMPETITIVENESS ENHANCEMENT FUND


Competitiveness does not end in the farm level…
processing and marketing costs also matter!

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C O M PA R I S O N 102

Processing and Marketing Costs


Item Philippines Thailand Vietnam
Drying cost (P/kg) 0.26 0.33 0.52
Transport cost (P/kg) 2.09 1.08 1.76
Milling cost (P/kg) 1.38 0.89 0.93
Storage cost (P/kg) 0.19 0.20 0.23
Packaging cost (P/kg) 0.45 0.14 0.22
Cost of working capital (P/kg) 0.27 0.09 0.11
Total marketing cost (P/kg) 4.63 2.73 3.78
Returns above major cost (P/kg) 4.43 2.54 0.77

Source: Benchmarking Project

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103

If we import from Vietnam at 35% tariff,


how much will be the competitive production cost?

P 30.83
2
= 15.41
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104

If we import from Vietnam at 35% tariff,


how much will be the competitive production cost?
14.04 (12.41) = Price of Dry
Paddy
4.8 (4.24) - Current profit
per kg
10.36 (8.17) = Prod’n cost to
maintain profit
(In fresh palay equivalent)

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E di parang matatabunan
na ng imported rice ang
mga magsasaka?!!

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2018
World Rice Imports

218
rice importing geographies

49 51
% %
15
rice importing countries

http://www.worldstopexports.com/rice-imports-by-country/ RICE COMPETITIVENESS ENHANCEMENT FUND


2018
World Rice Imports

218
rice importing geographies

15
rice importing countries 2%
Philippines

http://www.worldstopexports.com/rice-imports-by-country/ RICE COMPETITIVENESS ENHANCEMENT FUND


Ano ba ang mga
pwede nating gawin?

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Focus on Increasing Rice Yield
Comparative yield (in 14% MC) & production cost of palay,
by seed class, 2013 DS, in NE, Philippines.

15.00 13.63 Cost/kg

12.00 11.58 Dry Yield (14% MC in kg)


9.80
9.00
7.20
6.00 5.28
4.13 Promote high quality seeds
3.00
coupled with appropriate crop
0.00 management in suitable areas
hybrid high quality inbred low quality inbred

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Reduce Production Cost - LABOR

30% of cost  P3.76/kg

Activity Labor Savings in cost


per kg of paddy

Crop Transplanting: Direct seeding: P1.14


establishment 25 man-days 2 man-days

Harvesting & Combine:


threshing 21 man-days 2 man-days P1.56

1 man-day = 8 hours of work for 1 person

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Reduce Marketing Cost and Margin


✓ Reduce transport cost


✓ Increase capacity utilization of
big rice mills through provision
of custom milling services


✓ Reduce marketing layers to
minimize margin

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May ginagawa ba ang
gobyerno?

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Philippine Rice Industry
Roadmap 2040

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Rice Competitiveness
Enhancement Fund (RCEF)

RICE COMPETITIVENESS ENHANCEMENT FUND


REPUBLIC ACT NO. 11203: SALIENT POINTS

Rice Competitiveness Enhancement Fund (RCEF)



✓ Fund from tariff revenues


✓ Created to cushion the effect of rice trade
liberalization to local rice farmers and farm workers

✓ P10 billion for mechanization, seeds, extension,
and credit

✓ excess tariff for financial assistance, land titling,
crop insurance, farm diversification

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✓ A special account in ✓ A review on the 6th year ✓ DA Secretary’s
RCEF general fund to be in
place 90 days upon
by COCAFM accountability and
responsibility

P10B annually for


effectivity of the act
✓ Unused portion not to
revert to General Fund
✓ Fund releases not
subject to any ceiling
by DBM
next 6 years

RSBSA-listed
P5B PHilMech
Farmers/Farm
Machine Workers and their
dependents YIELD
P3B PhilRice
Inbred Seeds

P1B DBP (500M)


Landbank (500M)
Credit INCOME
TESDA (700M) DA-accredited PRODUCTION

P1B PhilRice (100M)


PHilMech (100M)
Rice COST

Extension ATI (100M) Coops/Assocs.

*Spending to be based on the Rice Industry Roadmap


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https://get.pxhere.com/photo/silhouette-light-night-sunlight-tunnel-love-shadow-darkness-christian-faith-hope-emotion-in-the-dark-computer-wallpaper-1169066.jpg

“ Hope is being
able to see that
there is light
despite of the


darkness.

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THANK YOU
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