PH Rice Imports Won’t Reach 4.7M MT Despite Tariff Cut — DA

The Philippines is not expected to meet the U.S. Department of Agriculture’s (USDA) projection of 4.7 million metric tons (MT) of rice imports this year, despite a recent tariff cut, according to Agriculture Secretary Francisco Tiu Laurel Jr.

Speaking at the post-State of the Nation Address (SONA) forum in Pasay City on Tuesday, Tiu Laurel emphasized that the reduction in tariffs is not anticipated to significantly boost import volumes. “I don’t think the reduction of tariffs will increase importation… it’s basically demand-driven,” he said. “I really don’t think we will reach 4.7 [million MT],” he added, countering the USDA’s forecast.

The USDA’s July Grain: World Market and Trade report suggested that the Philippines’ rice imports would rise following the reduction of the import tariff rate from 35% to 15%. This policy change, aimed at addressing rising domestic consumer prices, was expected to increase rice imports.

However, data from the Bureau of Plant Industry shows that as of the first seven months of 2024, the Philippines has imported only 2.37 million MT of rice.

Policy and Market Context

President Ferdinand Marcos Jr. issued Executive Order 62 to reduce import tariff rates on rice and other agricultural products. This move has been challenged in the Supreme Court by petitioners who argue that it undermines the state policy of developing a self-reliant and independent national economy.

The Department of Agriculture (DA) has defended the tariff reduction, suggesting it could lower the price of imported rice by PHP 6 to PHP 7 per kilo. Despite this, rice inflation remains high, standing at 22.5% in June, slightly down from 23% in May but still at a double-digit level.

Recent rice inflation rates have been the highest in about 15 years, driven by high global prices and exacerbated by India’s export ban on its white basmati rice.

Looking Ahead

The DA continues to monitor the impact of tariff changes and import volumes on the domestic rice market. While tariff reductions aim to alleviate consumer prices, the government maintains that actual import levels will be determined by market demand rather than policy adjustments alone.