PH refines plan to hit self-sufficiency in 2013

Agriculture Secretary Proceso Alcala mapped out plans to encourage farmers to plant up to 3 rice crops this 2013 so the Philippines, one of the world’s top importers of the grain, can hit a highly-touted target to be self-sufficient in rice in 2013.

The Agriculture Department is aiming to boost unmilled rice production to 20 million metric tons, up over 11% from the record harvest of 18 million tons in 2012. The Department will encourage farmers to plant right after harvesting the summer crop in May, and then do a quick turnaround by planting another rice crop in mid-September.

The quick turnaround will cover 300,000 hectares that are irrigated, and participating farmers will be given free seeds and crop insurance coverage, vital since they will be planting in the middle of the Philippine typhoon season.

As another incentive, Alcala instructed the National Food Authority (NFA) to “intensify” its rice buying program. The NFA is the government agency in charge of the rice market, and it plans to buy at least 615,000 tons of rice this 2013.

The Agriculture Department will also expand a credit program in the country’s 20 rice-producing provinces, taking particular aim at farmers who belong to irrigating associations in an attempt to boost production.

Rice stocks

There is a lot of skepticism in the rice market the Philippines can hit the mark.

The Department’s Bureau of Agricultural Statistics said rice inventories as of December 1, 2012 dropped nearly 16% from year-ago levels to 2.61 million tons. That is equivalent to 77 days of consumption, the BAS says, which is close to the 90 days or 3 months’ worth of rice stocks considered prudent for a country of nearly 100 million people.

That number is deceiving. NFA warehouses only hold 18 days of rice stocks and commercial warehouses have 20 days. Some 39 days of rice stocks are in private households which the public does not have any access to.

The government has enough rice stocks for less than 3 weeks of daily consumption – a level that is wafer thin at best. What this means is that the Philippine government is ill-prepared if a major typhoon strikes a major rice-growing area.

Given surging demand and a growing population, there are a lot of doubts the Philippines will be self-sufficient in rice.

A report by the U.S. agriculture attaché at the U.S. embassy in Manila about two weeks ago said that despite increased rice output, rising demand will force the country to import 1.5 million metric tons of rice, the same amount it imported in 2012.

Attaché reports are compiled by U.S. agricultural experts in its embassies even if they are not considered official data issued by the U.S. Agriculture Department. But they are considered as highly reliable by industry experts and the commodity trading community.

“As a matter of government policy, a 90-day national rice buffer stock entering the third quarter of each year should be maintained,” the report said. “At an estimated national daily rice requirement of 34,000 tons, ending rice stocks in marketing year 2012/13 would be sufficient for around 40 days.”

The Philippines is also hemmed in by the amount of land it can plant to rice, currently around 4.69 million hectares, and dwarfed considerably when compared to Vietnam’s 7.41 million hectares and Thailand’s 10.25 million hectares. – Rappler.com

Note: The author is with Philippine Commodities Digest, a weekly publication of New Jersey-based A & V Media that provides a comprehensive roundup of developments and trends in the country’s key farming and mining sectors.