RP will import to tackle rice shortage

RP will import to tackle rice shortage

MANILA (Reuter): A rice shortage in the Philippines which sent prices up will ease as imports from Thailand and other Asian countries begin to arrive, senior agricultural officials said yesterday.

A drought that hit the dry season crop forced the Philippines to import up to 250,000 tons of rice from Thailand, China, Vietnam, India and Japan. An initial amount of about 30,000 tons has already arrived in Manila's port.

"We can see prices abating by the end of the week," Romeo David, chief of the National Food Authority (NFA), told a television station early yesterday. "We are now in very good shape because the rice has started to arrive."

The NFA is the government agency in charge of maintaining a national buffer stock equivalent to 90 days of consumption to prevent a sharp rise in prices.

Prices of rice, staple food of the Philippines' 68 million people, climbed to as high as 25 pesos (98 U.S. cents) a kg in some areas after drought sharply trimmed the inventory going into the seasonally lean third quarter.

Average prices for ordinary rice increased to as much as 14-15 pesos (54-58 cents) a kg in the past few weeks from 12-13 pesos (47-50 cents) a few months ago.

David said the imported rice would be sold at 10.25 pesos (40 cents) a kg to flush out traders hoarding the staple and stabilize escalating prices. The rest of the imports would arrive by the end of August.

But production problems will continue to plague rice output in coming years because building irrigation facilities and encouraging the use of more fertilizer among farmers will take time, officials said.

"We really need big irrigation systems," Agriculture Undersecretary Manuel Lantin said on the same television program. "Over the last 10 years, the investment in irrigation systems is insufficient."

The government plans to spend up to 24 billion pesos ($940 million) over the next four years on irrigation networks, market roads and milling facilities to raise average yields to nearly 10 tons of rice per hectare from the current 3.5 to four tons per hectare.

Latin said the agriculture department is also worried that the rate at which farmers use fertilizer remains "very low".

Agriculture officials are worried that earlier forecasts of a harvest of two million tons of unmilled rice in the third quarter may fall short, forcing the government to lower its prediction of a harvest of 11 million tons in calendar 1995.

"If the rain in some areas is again below normal, the rice crop for the third and fourth quarter this year may again be affected," a rice dealer said.

Philippine unmilled rice production in the first half of 1995 slipped to about 4.29 million tons from 4.87 million in the same period in 1994.

Production in the second half of this year is forecast to reach 6.7 million tons, the bulk of which will be harvested in the last quarter.