President says gov’t is ‘slowly getting there’ on P20/kilo rice

PRESIDENT Ferdinand R. Marcos, Jr. said on Thursday that the government is making gradual progress in fulfilling his campaign promise of bringing the price of rice down to P20 per kilogram.

He was speaking at the launch of Bicol region’s first Kadiwa outlet. Kadiwa stores are government-supported centers promising lower prices because of their farm-to-consumer distribution model and subsidized transport.

“I said before I was elected that my dream was to lower the price of rice to P20. We have not yet reached that. We are slowly getting there,” he said in a video streamed live on Facebook.

“We’re now at P25. Just a little more, we’ll get there.”

According to the National Food Authority (NFA) website, P25 is the wholesale price for domestically-grown rice as well as for the imported well-milled variety. Well-milled is defined as consisting of 25% broken grains.

The price the NFA sells to consumers is P27 per kilo for both domestic and imported rice.

The NFA also sells rice to government agencies and private charities at P25 per kilo.

Commercial dealers sell rice in Metro manila at P33 per kilo for domestic rice, according to government price monitoring reports as of March 15. Imported rice sells for P37 a kilo.

Rice at some Kadiwa stores sold by the NFA can go for P20 a kilo.

“If the President’s claim is true, then this is good news. However, the bigger question we need to ask is: what were the things we had to give up to get to this price level?” Emy Ruth D. Gianan, who teaches economics at the Polytechnic University of the Philippines, said via chat.

“If this has been done at the expense of our farmers and sellers, then this reflects the kind of policy-making we prioritize in the government.”

Mr. Marcos said at the Kadiwa event that aside from providing consumers with cheap basic goods, Kadiwa also seeks to assist producers in accessing markets directly.

At Kadiwa outlets, the NFA also sells rice at “reduced prices” while the Bureau of Fisheries and Aquatic Resources (BFAR) offers “affordable” seafood products, according to the Presidential Communications Office.

The only way to maintain Kadiwa operations is to boost domestic production, Mr. Marcos told reporters on the sidelines of his Camarines Sur event.

“Kung hindi kaya ng production, mag-i-import tayo. And sa lahat ng iniiwasan natin ’yungmag-import. Kaya’t ang pinapatibay natin ’yung production side na ’yan. Kasi kung marami at may sistema tayong maganda na mapaparating sa palengke, ’yung mga bilihin ay makokontrol natin ang presyo (If domestic production does not hold up its end, we will import, which we are avoiding as much as possible. That is why we must boost the production side. If we work on getting more goods to market, we will be able to keep prices in check,” he was quoted as saying in a Palace-supplied transcript.

The Philippines imports much of its food and farm inputs, making it vulnerable to imported inflation.

“So ’yun ang general system na ating ginagawa. Pero ang puno’t dulo niyan, para mawala na ’yung importation, para patuloy, hindi na natin kailangan bayaran ’yung inflation na nanggagaling sa ibang lugar dahil nag-i-import tayo roon. (That is the general idea behind our actions. The objective is to minimize imports so we are not exposed to high prices in the commodities’ countries of origin),” he said.

The President said the government is hoping to inject more technology into agriculture.

“We have to convert the Department of Agriculture (DA) into a high-tech operation because that’s the only way… to increase production. So we have to bring in the technology. The technology exists, it’s there,” he said.

Leonardo A. Lanzona, who teaches economics at the Ateneo De Manila, said the Kadiwa program is “exploiting” the weakness of small and medium scale traders who have traditionally competed with bigger merchants.

“A lot of the problems in food prices can be traced to the dominance of larger and well-financed merchants, mainly colluding to strengthen market power,” he said via Messenger chat.

He said before the pandemic, smaller merchants competed for market share — “a situation that no longer exists because of the closure of many the retail micro, small and medium enterprises at the height of the pandemic.”

“Instead of creating an enabling atmosphere for these retail MSMEs, the government through the Kadiwa has appropriated the markets once held these enterprises,” he said.  “But Kadiwa can only do so much as the dominant merchants have kept their large market shares.”

“The majority of the retail MSMEs remain incapacitated, a situation that is reinforced and prolonged by the restoration of these Kadiwa outlets.”

Ayn G. Torres, a researcher with World Agroforestry Philippines, said any discussion of Kadiwa must also consider the public funds used to prop up the program.

“It may still be fairly early to tell whether we are now realizing the benefits on prices saved vs investment spent,” she said via chat.

Ms. Torres said it was a surprise when the President last week said he was considering permanent Kadiwa locations, after he had assured that Kadiwa stores would only remain in operation until the prices of basic commodities have stabilized.

“In the long run, the government must still be able to address the problems in the market,” she said.

Mr. Marcos said during that program that other products such as candles, coffee, and fabrics are also being sold in Kadiwa outlets, expanding the market reach of small businesses, which employ more than 60% of Filipino workers. 

Mr. Marcos is also his own Agriculture Secretary, taking office with a promise to boost domestic production and keep imports to a minimum, though he has resorted to importing sugar and onions to stabilize prices of those commodities.

During the program, Camarines Sur Governor Vincenzo Renato Luigi R. Villafuerte said the province will encourage municipalities to buy unmilled rice, known as palay, directly from the farmers. The local governments will then carry out rice milling operations.

The President was also visiting the region to break ground on two social housing projects in Naga City.

The projects will consist of 13,000 units in two separate Naga neighborhoods.

“It is difficult for us to ask our countrymen to help in improving their lives and the economy when they do not even have homes where they can rest and spend time with their loved ones.”

Camarines Sur is the home province of former Vice-President Maria Leonor G. Robredo, who also contested the 2022 Presidential election. Ms. Robredo won by landslide in the province with 870,000 votes against Mr. Marcos’ 93,000 votes. — Kyle Aristophere T. Atienza