MANILA, Philippines – While rice retailers think setting price ceilings on rice is a good idea, they bemoaned the “rushed” policy, saying it would incur deficits for retailers since they already stocked up on expensive rice.

“Ang problema, ‘wag sana niyang i-implement ura-urada kasi kami pong mga retailers, may mga stock po kaming nabili na ang mahal pa,” said Frederic Dy, president of the Grains Retailers Confederation of the Philippines (GRECON), in a Radyo5 interview on Monday, September 4.

“Ang mangyayari nito…kalugian ang aabutin namin.“

(Marcos shouldn’t be hasty in implementing because retailers still have stocks we bought at a high price. What will happen is…we will incur losses.)

President Ferdinand Marcos Jr., who is concurrent Department of Agriculture (DA) secretary, imposed a price cap on rice through Executive Order No. 39 dated August 31.

The EO imposes a price cap on regular and well-milled rice and takes effect on Tuesday, September 5, or five days after the order was signed.

According to Dy, the government should have given them three weeks to a month to prepare so they could have dispatched their expensive supplies.

No profits

Across the country, regional presidents of the GRECON are already complaining. Currently, their capital for a kilo of well-milled rice is P49. This already exceeds the price cap of P45 for well-milled rice by P4. Typically, Dy explained, retailers get a profit of P2 per kilo to cover the costs of containers, manpower, and rent.

“If the price cap for well-milled rice is P45, it should at least be sold to retailers at P42,” said Dy in Filipino.

“Our profit is fixed…. The EO should have started with the wholesalers, rice millers, and importers,” he added. “So that when the supply reaches us, rice will still be cheap and we could sell it by the price cap mandated by the government.”

To keep profits, retailers could opt to close down or hold on to their supplies and wait for the price cap to be lifted. This would affect consumers, who could encounter higher prices of rice when supplies get more scarce.

The price cap could also drive farmgate prices lower, affecting farmers.

Gov’t subsidy

According to Dy, there also have been no consultations with the agriculture department. They didn’t also see any DA staff meeting with retailers to inform them about the price cap.

“Wala po kaming nakikitang mga empleyado ng DA [na] mag-disseminate dito. Isa rin po ‘yan [na] problema,“ Dy said. (We didn’t see any employees from the DA disseminating information here. That’s also one of the problems.)

In a statement on Monday, House Speaker Martin Romualdez said they would engage with leaders of rice retailers later this week to hear their concerns.

Romualdez also said the government is looking at earmarking P2 billion to provide assistance to affected retailers. – Rappler.com