Rice imports fail to tame inflation in July 2018
MANILA, Philippines (UPDATED) – The government imported some 250,000 metric tons of rice from Thailand and Vietnam last June, yet this move failed to bring down prices of rice in the local market.
Data from the Philippine Statistics Authority (PSA) released on Tuesday, August 7, showed that rice inflation rose to 5% from the previous 4.7%.
Overall inflation in July reached 5.7%. The figure is within the upper end of the Bangko Sentral ng Pilipinas estimate.
The average retail price of regular milled rice rose to 8.91% year-on-year in the 2nd week of July, the fastest for 2018.
Regular milled rice is currently priced at an average of P41.21 per kilo.
Rice prices started to soar this year when the supply of National Food Authority (NFA) got depleted in April. (READ: Rice prices soar as Duterte marks 2nd year in office)
In theory, importation of rice would increase the supply of rice in the market and bring prices down. This did not happen and imports failed to make an impact on prices.
Finance Undersecretary Karl Kendrick Chua underscored the importance of rice supply in bringing down inflation.
He cited Central Luzon's inflation which was only at 2.7%, which he said illustrated the need for sufficient rice supply for inflation to be manageable.
"It was raining constantly so we cannot bring the rice down [from the ships]. If rice gets wet, it is spoiled," Chua said.
Economic managers are pushing for the passage of rice tariffication and the lifting of rice import quotas to spur competition and bring down rice prices by as much as P7 per kilo.
"Part of the supply problem is the country's declining rice stock inventory – caused by weather disturbances in the country and in other rice-producing countries like Thailand and Vietnam – which is taking a toll on the prices of rice," economic managers said.
Speaker Gloria Macapagal Arroyo also pushed for the measure and discussed it with President Rodrigo Duterte's economic team.
But Bantay Bigas spokesperson Cathy Estavillo slammed the move. She warned that bringing in even more cheaper imported rice would hurt local farmers.
Estavillo also said rice imports have failed to curb inflation. – Rappler.com