DA Considers Raising Rice Tariffs if Prices Drop Below P45/kilo

Agriculture Secretary Francisco Tiu Laurel Jr. announced on Tuesday that the Department of Agriculture (DA) may propose an increase in the tariff rate for rice imports if retail prices drop significantly in the next four months. This recommendation aligns with the periodic review mandated under Executive Order No. 62.

Current and Potential Tariff Adjustments

At a news forum in Taguig City, Laurel suggested that the tariff on rice imports, currently reduced from 35% to 15% until 2028, could be raised if market conditions are favorable. EO 62 requires a review of these rates every four months, starting from July 6.

“The review will suffice to make sure that in case when the prices go down and the consumers are happy… then maybe we can raise the tariff rates again,” said Laurel. He added that by November, global rice prices might decrease, especially if India lifts its export ban on rice.

Price Benchmarks and Industry Impact

Laurel indicated that the DA would consider recommending a tariff increase if retail rice prices fall to between P42 and P45 per kilo. Currently, well-milled rice is priced at P52 to P55 per kilo.

The DA acknowledges the challenges faced by local rice farmers but emphasized the necessity of the reduced tariff to address soaring prices. “There’s another issue of exchange rate… all of the burden goes to consumers,” Laurel noted. He assured that the DA has programs to support local farmers by providing more inputs to boost their yields.

Concerns and Potential Legal Challenges

Industry players have voiced concerns that the tariff reduction may not significantly lower rice prices and could harm local farmers by enabling traders to decrease buying prices for palay. If the President formalizes the tariff cuts, farmers’ groups plan to file a temporary restraining order against the measure.