The Department of Trade and Industry (DTI), through its international trading arm the Philippine International Trading Corp. (PITC), is exploring new measures to try and bring down the increasing price of commercially available rice. The PITC is currently seeking a tax expenditure subsidy (TES) to reduce the cost of importing 150,00 metric tons, or 3 million bags, of rice from either Vietnam or Thailand.
PITC president and chief executive Dave Almarinez said in a statement that the rice is intended to be sold directly for C, D and E consumers at P27 per kilogram, an amount much more affordable than the current market prices which average nationwide at P43 per kilogram.
Almarinez is scheduled today, September 24, to present a proposal to import tariff-free rice before the National Food Authority (NFA) Council, including to Agriculture Secretary Manny Piñol.
Currently, imported rice faces 35 percent tariff, which is a factor in the high market prices today, according to Almarinez.
“The biggest factor is the tariff so we are asking for a TES to lower the cost of importation,” he said.
Besides the measure being proposed today, the PITC is also exploring alternative ways to combat the rising prices of commercially available rice, such as making use of existing NFA facilities. The DTI has established consolidated retailer associations, such as the Philippine Amalgamated Supermarkets Association, Inc. (PAGASA), to expand the retail distribution of NFA rice.
DTI has also been opening new channels into the market through accredited NFA rice retailers in a bid to flood the market with more affordable products.
Should the proposed lowered tariff be approved following today’s presentation, the PITC expects the new rice stocks to arrive before end-October this year, ahead of NFA rice imports which are slated to arrive in November.
“We will augment supply, we will not be competing against NFA. Our goal is to arrest the prices and make it stable, stop rice price manipulation and hoarding,” stressed Almarinez while speaking on the goal of the tariff reduction.
Almarinez also explained that the PITC’s charter allows for both government to government trading and private business transactions. This would mean easy facilitation of stock distribution for the imported rice directly to selected distributors and retailers approved by the Trade Department.
“This is forward selling. We are not buying for stocking purposes. We have a concrete channel of distribution direct to retailers,” said Almarinez.