Fields of Insecurity: Food Security in the Philippines amidst the Rice

Tariffication Law
Oct 25, 2024
[Link]
the-philippines-amidst-the-rice-tariffication-law-429bb73d8e58

Food Insecurity (Rice) as seen in farmers of Tumauini, Isabela

More than anything, rice has always been central to the lives of
Isabelinos. As the second largest rice-producing province in the country,
Isabela contributes 15% of the country’s aggregate rice production annually
(Philippine Rice Research Institute, 2023). Thus, you will find that a
significant portion of the working population comprises farmers — a fact I
know and understand intimately, having grown up and lived in this province
for seventeen years.
To be specific, my family is close to many families of farmers. I shared
many conversations with them over lunch at a small house in the farmlands
in San Mateo, Tumauini, Isabela, with a plate of rice as a centerpiece, or
over congee during slow meriendas. They told me everything there is to
know about rice. But most of all, they told me about the struggles they face:
the difficulties in selling their produce to palay and rice traders, the lack of
machinery and facilities despite their desire to increase productivity; the
growing pest problem and the insufficiency of government subsidies to cover
the rising prices of fertilizers; the challenges posed by extreme heat and
typhoons to cropping and harvest season; and how amidst all these issues
and many more, they have to take out loans to afford basic necessities
— even, and especially rice — and send their children to school, because
being a farmer in this country means to sign up for poverty.
Such challenges faced by farmers in Tumauini reflect a broader
experience shared by Filipino farmers, which indicates the prevailing
issue of food insecurity.
Food insecurity exists when the four dimensions of food security, which
are physical availability of food, economic and physical access food, food
utilization, and stability of the three dimensions over time, are not met
(World Bank, 2023). Food insecurity, as would be further delineated in this
article, is most evident among Filipino farmers.

Rice Sector Insecurity in the Philippines amidst the Rice Tariffication

Law
That said, to provide further context, the Philippines, as with many
Asian countries, is a rice-producing country. In 2021, the Philippines
recorded 4.81 million hectares of area harvested for rice and a total
production of 19.96 million metric tons, with the value amounting to PHP
403.89 billion (Jamille, 2024). However, such a level of production cannot
meet national demand, seeing that the Philippines’ average rice self-
sufficiency ratio (SSR) since 2018 has been 81.9%, with the lowest being

1
77% in 2022 — the lowest level in 24 years since 1998 (Arcalas & Ordinario,
2023).
These data, coupled with rising rice prices, served to rationalize the
legislation of the Rice Tariffication Law (RTL) in 2019 which marked the
shift towards a purely-tariff import system from a tariff-quota system. As of
October 2024, the country remains as the world’s largest rice importer, with
imports estimated at 4.7 million metric tons this year (Lagare, 2024).
RTL aimed to aimed to lower rice retail prices, increase rice supply and
availability, boost palay production from 3.54 MT to 5 MT per hectare,
provide subsidies and machinery through the Rice Competitive
Enhancement Fund (RCEF) to lower production costs to at least P5 per kilo,
and eventually raise farmers’ incomes by 30% (Binaluyo et al.,
2023). However, given the difficulties in achieving these goals, it also
threatend the fulfillment of Sustainable Development Goals 1 (No
Poverty), 2 (Zero Hunger), and 8 (Decent Work and Economic
Growth).
First, despite the enactment of the RTL, the average monthly retail
prices for different rice types have continued to rise. In 2024, retail prices
increased by an average of 25% compared to 2023, and neared an all-time
high inflation rate of 36% (Yu, 2024). According to Estrada (2023), this is
because import dependence makes the domestic market vulnerable to global
price and supply fluctuations, both in cost and supply, especially when the
export countries are amidst domestic and/or international conflicts.
Second, RTL failed to curb high costs of rice production inputs, which
would supposedly better equip farmers’ competitiveness against imports.
This is because of the unequal distribution of RCEF benefits — which are
machinery, subsidies, and infrastructure, due to inadequate subsidies and
limited recipients (i.e. members of farmer cooperatives). Binaluyo et al.
(2023) found that only about half of local farmers received free seeds and
fertilizers from the Department of Agriculture (DA), while 71% did not have
access to storage and drying facilities. Equipment is inadequate and mostly
unavailable so there is reliance on manual transplanting, harvesting, and
threshing. Thus, despite support from RCEF, farmers still carry the majority
of the production costs, namely fuel expenses, seeds, fertilizers, labor
expenses, and machinery maintenance. Furthermore, Filipino farmers have
low technical rice production efficiency due to insecurity against the
inherent risks of farming such as climate change and land degradation.
Although climate-strategic equipment are being developed, these are yet to
reach farmers in areas outside the metro. As a result, there have been
difficulties in exponentially increasing productivity at par with top rice-
producing countries, leading to languid rice production (Lim, 2023).
Third, as for farmers, retail prices of palay dropped to 7%–10% after the
law was put in effect in 2019, with farmgate prices dropping by 21%. As of
2024, farmgate prices are P24.70 per kg from P18.72 in 2023 (Jamille,
2024). The average profit for farmers during a single cropping season since
the implementation of the RTL is approximately P4,804.04 (Casinillo, 2022).

2
Farmers report this as significantly low compared to previous cropping
seasons before RTL, thus, making it impossible for farmers to earn a livable
wage (Asia Development Bank, 2020; Briones, 2021). This problem is faced
on top of competing with the influx of rice imports in the domestic market.
These issues prove that the most sustainable and viable solution is to
repeal the RTL and prioritize heavy investment in the modernization of the
agricultural sector. However, such a solution proves to be difficult given that
the policy direction of the Marcos Jr. administration still leans towards
importation. Thus, the next best approach would be to strengthen and
expand the implementation of the RCEF’s modernization
program which can best address the farmers’ call to reduce prices of
agricultural inputs and minimize rice production costs.

Strengthening and expanding the implementation of the Rice

Competitive Enhancement Fund (RCEF)
Strengthening and expanding the implementation of the RCEF is
feasible as Cayetano et al. (2023) found that farmers in Guimba, Nueva
Ecija, saw its implementation as beneficial in in covering farming expenses,
reducing labor required for farming, minimizing losses, and overall effective
in enhancing productivity growth. The farmers also saw the equipment as
technologically up-to-date, although there are issues on machine literacy as
there are inadequate available qualified trainers to conduct training and
technical support, and overall limited information about the program
implementation of RCEF.
That said, this shall be achieved hand-in-hand with the full
implementation of the Agricultural and Fisheries Mechanization Law and the
Philippine Organic Agriculture Act (DA 2021). By mandate of this law and
the RTL, the DA shall increase the annual distribution of farm machinery to
Rice Farmer Cooperatives and Associations and expand the target
beneficiaries by including small-scale farmers who are not part of
cooperatives. This will be done through digital agriculture — which is the
digital collection, storage, analysis, and dissemination of electronic data and
information in agriculture, implemented through a bottom-up approach.
Specifically, a digitized and centralized information system shall be created
to collate data from concerned national government agencies, farmer
organizations, and other concerned non-government organizations.
Furthermore, through digital agriculture, the DA shall facilitate the
transition to digital agriculture to address agri-food market failures —
especially in regards to inefficient and insufficient farm-to-market roads,
facilitate buyer-seller matching, support vulnerable farmers, improve policy
making, and reduce overall costs (World Bank, 2020).
Additionally, the distributed machinery, which are technologies also
used by competitive rice-exporting countries, shall be sourced and
purchased from Filipino suppliers for a more sustainable and economical
approach. Take for instance the combine harvester, which is used by
Vietnamese farmers to reduce post-production costs while increasing

3
productivity (Lim, 2023). This machinery costs around PHP 1 million to PHP
1.5 million when purchased directly from foreign suppliers, compared to
combine harvesters funded by Department of Science and Technology–
Philippine Council for Agriculture, Aquatic and Natural Resources Research
and Development (DOST-PCAARRD), which only costs PHP 750,000 (Marfal,
2022).
In terms of rice seed development, propagation, and promotion, the
Crop Biotechnology Center at PhilRice, funded by the DOST-PCAARRD, is
already looking into understanding the genetic factors that influence the
development of L-type lateral roots, which enhance plant’s water and
nutrient absorption, provide plant stability, and allow adaptation to various
soils (Sabanal & Macaraeg, 2024). As for seed and fertilizer distribution, the
current public-private partnerships between the DA and local agricultural
distributors nationwide (e.g. Nita’s Agricultural Supplies and DA-Isabela for
Isabela) can be further strengthened by using the enhanced information
systems from digital agriculture to facilitate more efficient and strategic
distribution, reaching farmers from even the farthest rural areas. It is also
sustainable to shift from import reliance on fertilizers and purchase directly
from Filipino-made and owned fertilizers (i.e. Yara Philippines, Atlas
Fertilizer Corporation) to strengthen the domestic agricultural industry and
provide for cohesive interdependence of concerned domestic stakeholders in
it (World Bank, 2020).
Expanding distribution of machinery and seeds is crucial
because if farmers can have access to free farm assets, they reduce
their dependence on hired labor for hauling inputs and operating
machinery, thus lowering production costs (Casinillo, 2022).
More specifically, for every 1% increase in the value of farm assets is a
corresponding notable increase of P0.0059 in farmers’ economic profit. This
can be seen in neighboring rice-export countries such as Vietnam, which
employ direct seeding and combine harvesters, thus, having a labor cost of
only P6.22 per kg (Casinillo, 2022).
To further support this, the DA shall also see the intensification of the
Rice Extension Services Program under the RCEF by developing more
contemporary and modernized farm schools and expanding the teaching
workforce for knowledge and technology transfer. Furthermore, by
enhancing and widening the scope of up-skill training, farmers will be more
knowledgeable on contemporary farming practices such as crop and seed
production, modern rice farming techniques, and farm mechanization. This
will be done in collaboration with already existing partnerships with
PhilMech, PhilRice, Agricultural Training Institute (ATI), and Technical
Education and Skills Development Authority (TESDA) (World Bank, 2020).
The National Irrigation Administration (NIA) and the DA shall also
design and manage the modernization of irrigation systems tailored to
diverse cropping patterns, including non-traditional rice technologies and
other crops, through research and development. The NIA, DA, and DOST-
PCAARRD are to expand the already available climate vulnerability

4
assessment tools utilized by the national government and technical agencies.
To enhance its capacity, climate-resilient irrigation systems and balancing
reservoirs will also be integrated into the modernization plan to address
climate challenges and reduce climate-caused pre-harvest and post-harvest
loss. In relation to climate-smart agriculture (CSA), the DA is also
recommended to mobilize a multi-stakeholder task force — which can be
achieved using the proposition of digital agriculture, to draft a CSA strategy
that reduces carbon footprint, which is an issue faced by rice importation
(World Bank, 2020). These proposed solutions can stabilize rice prices while
improving the status quo of Filipino farmers; thus, benefiting consumers and
producers.

Final Overview
Food insecurity exists when any of the four dimensions of food security,
as identified in the 1996 World Food Summit are not achieved: physical
availability of food, economic and physical access to food, food utilization,
and stability of the three dimensions over time (World Bank, 2023). In the
Philippines, one of the sectors where food insecurity palpably exists is in
farmers, as is the case for farmers in Tumauini, Isabela. On a much broader
note, this is caused by a blunting domestic agricultural sector that prioritizes
imports, and leaves farmers to grapple with insufficient government support
for agricultural inputs and outputs (i.e. seeds, fertilizers, pesticides,
irrigation systems, machinery, labor, fuel), further contributing to their
unproductivity and uncompetitiveness. The Rice Tariffication Law allowed
for import influx, which in turn, aimed to boost productivity,
competitiveness, and lower costs (Binaluyo et al., 2023; Casinillo, 2022; Lim,
2023; Jamulle, 2024). However, it has largely failed to meet its goals and
instead, exacerbated the existing difficulties farmers face in earning
sustainable livelihood, threatening the fulfillment of Sustainable
Development Goals 1 (No Poverty), 2 (Zero Hunger), and 8 (Decent Work
and Economic Growth).
Thus, the need for a strengthened and expanded approach to
agricultural modernization through improved implementation of the
components of the Rice Competitive Enhancement Fund under the RTL.
Specifically, this entails the installation of digital agricultural systems and
climate-smart technologies for a wider and more efficient agricultural input
distribution system, better agricultural infrastructure and systems, and
improved overall policy making on sustainable agriculture and agricultural
modernization. These shall be further supported by expanding modernized
local farming education in collaboration with concerned national agencies.
In summary, these solutions address the root of food insecurity,
and by extension, promote long-term economic growth, poverty
reduction, and domestic agricultural resilience and competitiveness.
In pursuing these, farming will be a viable and sustainable
profession, in which genuine development can be achieved.
Bibliography

5
Arcalas, J., & Ordinario, C. (2023, October 10). Rice sufficiency level falls to
24-year low. Philippine Institute for Development
Studies. [Link]
level-falls-to-24-year-low
Argosino, F. (2024, July). PH aiming for rice self-sufficiency by 2028 —
Romualdez. INQUIRER. [Link]
for-rice-self-sufficiency-by-2028-romualdez
Asian Development Bank (2020). Competitive and inclusive agriculture
development program, subprogram 1 (RRP PHI 53353) sector assessment
(summary): Agriculture, natural resources, and rural development sector
road map 1. Sector performance, problems, and opportunities. Asian
Development Bank.
Binaluyo, J., Lascano, L. V., & Binaluyo, J. (2023). Prospects And Challenges:
Rice Tariffication Law’s Influence On Region III Philippines Rice
Industry. Journal of Namibian Studies: History, Politics, Culture, 36, 932–
959. [Link]
Briones, R. (2021). Does rice tariffication in the Philippines worsen income
poverty and
inequality? [Link]
df
Casilao, J. L. (2024, July 4). Farmers file petition vs. EO lowering tariff for
rice. GMA News
Online. [Link]
-file-petition-vs-eo-lowering-tariff-for-rice/story/
Casinillo, L. (2022). Modeling profitability in rice farming under Philippine
rice tariffication Law: An econometric approach. Scientific Papers Series
Management, Economic Engineering in Agriculture and Rural
Development, 22(3), 1–
8. [Link]
TABILITY_IN_RICE_FARMING_UNDER_PHILIPPINE_RICE_TARIFFICATION
_LAW_AN_ECONOMETRIC_APPROACH
Cayetano, E. L., Cabading, R., Cabardo, S., Cruz, C. M. B. D., & Armas, K.
(2023). Factors affecting productivity and challenges encountered to Rice
Competitiveness Enhancement Fund (RCEF) Mechanization Program among
Farmers’ Cooperative and Associations (FCAs) of Guimba. International
Journal of Advanced Engineering, Management and Science, 9(12), 21–
25. [Link]
Chanco, B. (2023, December 18). Food inflation and poverty. Philippine
Institute for Development Studies. [Link]
the-news/food-inflation-and-poverty
Dela Peña, K. (2022, August 16). Arguments to repeal rice tariffication:
Prices still high but farmers poorer. Philippine Institute for Development
Studies. [Link]
repeal-rice-tariffication-prices-still-high-but-farmers-poorer
Estrada, D. C. (2023). A public policy review: Evaluating RTL’s effectiveness
on lowering rice prices: a local perspective from the countryside of the

6
Philippines. International Journal of Advanced Engineering and
Management Research, 08(06), 17–
24. [Link]
Jamille, J. (2024, September 6). 2024 Rice Production and Price Trends,
Decreasing Imports, and Initiatives to Improve Yield — Industry Strategic
Science and Technology Plans (ISPs) Platform.
DOST. [Link]
trends-decreasing-imports-and-initiatives-to-improve-yield/
Lim, C. T. (2023). Empirical analysis of rice prices, production, and
consumption in the Philippines: Implications for self-sufficiency
policy. Review of Integrative Business and Economics
Research, 13(2). [Link]
publication/
374194906_Empirical_Analysis_of_Rice_Prices_Production_and_Consumptio
n_in_the_Philippines_Implications_for_Self-Sufficiency_Policy/links/
6513498acce2460b6c36bd22/Empirical-Analysis-of-Rice-Prices-Production-
and-Consumption-in-the-Philippines-Implications-for-Self-Sufficiency-
[Link]
Marfal, A. M. (2022, August 31). DOST-funded combine harvester eyes to
reduce post-harvest losses of Filipino farmers.
DOST. [Link]
2891-dost-funded-combine-harvester-eyes-to-reduce-post-harvest-losses-of-
[Link]
Philippine Daily Inquirer. (2024, February). Promising rice self-sufficiency.
INQUIRER. [Link]
sufficiency#:~:text=In%20fact%2C%20it%20is%20only
Philippine Rice Research Institute. (2023). State of the Rice Sector in
Isabela. Philippine Rice Research
Institute. [Link]
Yu, L. S. (2024, April 5). High rice inflation could linger until July as market
prices keep going up. RAPPLER. [Link]
rice-inflation-until-july-2024-market-price-going-up/
Sabanal, A. Q., & Macaraeg, J. A. M. (2024, April 17). DOST-PCAARRD,
PhilRice to improve rice root systems for increased adaptability to drought.
DOST-PCAARRD. [Link]
information-dispatch-qid-articles/dost-pcaarrd-philrice-to-improve-rice-root-
systems-for-increased-adaptability-to-drought
The World Bank. (2020, September 9). PHILIPPINES: Vibrant agriculture is
key to faster recovery and poverty reduction. World
Bank. [Link]
nes-vibrant-agriculture-is-key-to-faster-recovery-and-poverty-reduction
The World Bank. (2023, August 28). What is food security. World Bank;
World Bank
Group. [Link]
update/what-is-food-security