RP farmers warn of looming rice crisis

March 26, 2008


http://www.gmanews. tv/story/ 86300/RP- farmers-warn- of-looming- rice-crisis


MANILA, Philippines - Philippine farmers warned Wednesday that the country

was facing a serious rice supply crisis, as the government signed a deal to import rice from Vietnam to boost local reserves at a time of rising prices and shrinking global stocks.

The National Rice Farmers Council said the shortage could cause the price of rice — the nation's staple food — to soar to 40 pesos ($1; €0.64) per kilogram from the current average of around 25 pesos ($0.60; €0.38) per kilogram.

"The traders will definitely take advantage of the limited supply, while the government will be dependent on the imported rice for its buffer stock," said Jimmy Tadeo, the group's chairman.

The Philippines consumes about 11.9 million metric tons of rice annually, most of which is grown domestically. But dwindling domestic production and corruption in the rice supply chain have created a recurrent shortfall of about 10 percent. The government has to purchase about 2 million metric tons from the international market every year, making the Philippines the world's biggest rice importer.

The Agriculture Department says rising demand in the Middle East and Africa has increased the price of rice in Vietnam and Thailand — the world's top exporters — to up to $500 (€317) per metric ton, a 25 percent jump in just the last month.

Agriculture Secretary Artur Yap said the government would sign an agreement with Vietnam on Wednesday guaranteeing the supply of 1 million metric tons of rice.

The National Food Authority, the state-owned grains trading company, has so far signed contracts for 1.2 million tons of rice, mostly from Vietnam and Thailand.

Yap said the government's rice reserve would last 57 days, and denied there was any shortage, "even if prices are high." A number of factors contributed to rising costs, he said, including higher fertilizer and oil prices as well as climate change.

The government plans to increase local production by planting an additional 600,000 hectares (1.5 million acres) of rice during the rainy season in the country's 10 poorest provinces and another 500,000 hectares (1.2 million acres) in other provinces, he said.

President Gloria Macapagal Arroyo has vowed to crack down on rice hoarders, people who buy rice at a subsidized price from the NFA and sell it at a higher price in markets. Though no charges have yet been filed, Yap was staking out warehouses and following trucks to see where the rice was going, she said. -







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