Luzon A moves to extend the rice QR

The Luzon A cluster moved to extend the quantitative restriction (QR) on rice for another two years subject to the impending expiration of the waiver on the special treatment on rice in 2017.

Key rice industry players from the government, private sector, and other concerned organizations formulated unified inputs that can help the government in coming up with its position on the expiration of the waiver during the first leg of cluster-wide consultation on rice QR on September 22, 2016 at Hotel Stotsenberg, Angeles City, Pampanga.

Representatives from the Department of Agriculture Regional Field Offices (DA RFOs), local government units, rice farmer organizations, business sector (including traders/millers, seed growers, and input suppliers), Regional and Provincial Agriculture and Fishery Councils (RAFCs/ PAFCs), and civil society organizations engaged in rice industry development participated in the said event.

The cluster-wide consultation was undertaken by the DA through Philippine Council for Agriculture and Fisheries (PCAF), Policy Research Program (PRS) and National Rice Program to present the policy options that the government has on the expiration of the waiver on the special treatment on rice and to discuss the possible consequences that may arise from the government’s policy choices.

Participants listen attentively as Mr. Marlito Cabuños of Policy Research Service presents the government’s policy options (Photos courtesy of PDCD)

The first option is to secure another waiver while the second option is to tariffy.

Should the government wished to take the first option, it will provide concessions in exchange for another QR extension.

“If tariffication will be the chosen option, the tariffs that will be collected from the imports should be earmarked to serve as additional funding support to the programs of the government to help the rice farmers to increase their competitiveness,” one of the panelists suggested during the open forum.

According to Cabuños, if tariffication will be selected, there are three more choices that the government need to consider. First, tariffy based on the formula: higher internal price, lower external price = high tariff equivalent; second, tariffication plus upward adjustment of tariff equivalent; and third, tariffy plus negotiate with ASEAN member states.

The discussions were also focused on how our country can produce products with the same quality as the competitors but less expensive.

Among the recommendations were increase rice yield by using hybrid rice, reduce production cost especially labor by increasing mechanization level, reduce marketing cost and margin, increase efficiency of rice mills by increasing capacity utilization, reduce transport cost by improving transport networks and reduce marketing layers to minimize margins by having wholesale markets.

The second leg of the cluster-wide consultation will be held on Hotel Rembrandt, Quezon City on September 28, 2016.