PH eyes 5-year rice trade accord with Vietnam
The Philippines is working on a five-year rice trade agreement with Vietnam, the world’s third biggest exporter of the commodity after India and Thailand, to help ensure enough supply of the Filipino staple food in the local market.
This was discussed during a bilateral meeting at the 43rd Association of Southeast Asian Nations (Asean) Summit between President Ferdinand Marcos and Vietnamese Prime Minister Pham Minh Chinh.
“Our two countries will conclude an intergovernment agreement on rice trade so that our rice export to the Philippines will ensure food security in the Philippines. We look forward to having a stable framework of cooperation on rice trade for a long period of at least five years. With that we can ensure our production and you can also ensure imports from Vietnam,” Chinh told Marcos.
The President, who is also concurrent agriculture secretary, said that the country was looking forward to this deal in light of concerns with food security in the country amid the El Niño dry spell.
“We hope that we can find an agreement so that there will be an exchange,” said Marcos.
Talks of a rice deal with Vietnam have been ongoing since August, when Senior Undersecretary Domingo Panganiban of the Department of Agriculture (DA) said that 300,000 to 500,000 metric tons (MT) of additional rice might be imported from Vietnam at discounted prices.
Not the first
This will not be the first supply agreement between the two countries. The Philippines earlier had a supply agreement with Vietnam signed in 2008, wherein Manila was able to buy 1.5 million MT of rice from Vietnam from 2008 to 2010.
Vietnam, which attained rice self-sufficiency in the late 1980s, has remained the country’s biggest source of rice imports, supplying about 90 percent of the country’s requirements from abroad.
From January to May this year, the Philippines imported 1.5 million MT of rice from Vietnam worth $772.4 million, or equivalent to 42.3 percent of Vietnam’s total rice exports for the period.
Data from the Global Agricultural Information Network of the United States Department of Agriculture showed that in July 2023, Vietnam’s rice exports reached 656,869 MT, with its primary export markets being the Philippines, Indonesia, Ivory Coast, Ghana and China. Shipments to the Philippines that month surged by 45 percent to 239,400 MT and accounted for 36 percent of Vietnam’s total exports.
The Philippines has been relying on imports following the steady decline in areas planted to the commodity and overall farm productivity.
This has resulted in volatility in local prices that prompted President Marcos to issue Executive Order No. 39 last week to set a price ceiling of P41 a kilo for regular-milled rice and P45 for the well-milled variety starting Sept. 5.
The DA reported on Thursday that about 95 percent of rice retailers have complied with the price ceiling.
“So far as of yesterday, we have recorded a success rate of 95 percent, which means our retailers have complied,” DA spokesperson Willie Ann Angsiy said in an interview.
The DA recognized that some retailers found it challenging to follow the price cap, but assured the affected merchants that the government was prepared to assist them as long as they comply with EO 39.
The agency added that it would also deputize the National Food Authority (NFA) as it has the technical expertise to determine whether rice being sold in the market is properly classified as well-milled and regular-milled.
“Even if some of them are complaining, we will continue to disseminate information to explain the importance of complying with the price cap,” said Angsiy, DA legal services director. “While we acknowledge that some purchased their stocks at higher prices but we will solve the problem by providing various assistance such as financial, logistics and market linkages.”
The DA and the Department of Trade and Industry have started compiling a list of rice traders and retailers affected by the price ceiling.
Without giving a timetable for the price cap, Angsiy reiterated Mr. Marcos’ statement that it would be temporary. “Our goal is to stabilize prices,” she stressed.
The DA is anticipating retail prices to dip by the end of October as most of the estimated 2.92 MT of palay harvest from 15 provinces would come in, along with rice imports which “we assume will be enough,” she added.