Speaker: Cancellations of PH imports lead to 21% fall in world prices
Speaker Ferdinand Martin G. Romualdez on Thursday declared that the huge reduction in the prices of rice in the global market can be attributed to the recent implementation of Executive Order (EO) 39, which imposed price ceilings on two varieties of rice in the Philippines.
According to US-based Markets Insider, the price of rice in the world market decreased by 21 percent, from $384 per metric ton last July to $332.4 per metric ton this month.
“It is proven that the EO 39 of President (Ferdinand) Bongbong R. Marcos Jr. set commendable results not only in our country, (but in the world as well). We are hoping that the price decline in rice will continue,” Romualdez said in a statement.
Romualdez said he believes that the drop in the price of rice in the world market was due to mass cancellations made on imported rice by Philippine rice traders and importers in reaction to the price ceilings set by the government.
“Maybe because the importers and traders canceled their orders, there was suddenly an increase in the supply of rice abroad,” Romualdez said.
“It is obvious that the rise in rice prices in the markets is artificial because they have been hiding the rice in bodegas, as we have seen during our inspections,” he said.
Romualdez insisted that the palace was correct in imposing a price cap as it was the only effective way to discourage hoarders and price manipulators from carrying on with their illegal schemes.
House ways and means committee chairman Rep. Joey Sarte Salceda echoed Romualdez’s explanation, saying that the increase in the price of ricein the world market was artificial due to the high volume of demand from the Philippines.
“We have seen this crisis before and we know how to deal with it,” Salceda said.
“But we should not over-import so that our neighboring countries won’t anticipate that prices will go up,” Salcedo said in a mix of English and Filipino.
“The imposition of the price cap on rice by Malacañang shows that the artificial increase in the prices of rice in the world market is unacceptable,” he added.
Earlier, President Marcos issued EO 39 ordering a ceiling in the prices of rice: P41 per kilo for regular milled rice and P45 for well-milled rice.
The action came after the government received information that some unscrupulous traders were planning to raise prices to as high as P70 per kilo.
“This remarkable development marks a significant shift in our agricultural landscape and offers hope for our local consumers,” Romualdez said.
Romualdez, along with several lawmakers, earlier joined a series of surprise inspections by the Bureau of Customs (BoC) of several warehouses in Bulacan storing rice.
The House leader recently asked the BoC and law enforcers to send rice smugglers and hoarders to jail.
Meanwhile, the Philippines and Vietnam are finalizing a deal on an inter-government rice trade to ensure enough rice supply in the country during a bilateral meeting on the sidelines of the 43rd Association of Southeast Asian Nations (ASEAN) Summit in Indonesia.
Vietnamese Prime Minister Pham Minh Chinh gave the suggestion of forming a five-year rice supply agreement between the Philippines and Vietnam.
“I would suggest that the Ministries of Trade and Agriculture of the two countries will work together so that we can come up with a five-year agreement on the supply of rice and actually… the rice will be determined by the market,” Pham said
President Ferdinand Marcos Jr. welcomed the idea of a rice importation agreement, citing its importance in stabilizing the surge in rice prices and shortage of rice supply.
“However, the suggestion of a longer-term arrangement is an important one because just having that as an assurance will stabilize the situation, not only for the Philippines but for all of us in the region,” President Marcos said.
Previously, the Philippines signed a memorandum of agreement on the supply of Vietnamese rice to the Philippines in 2008, with Vietnam selling 1.5 million metric tons of rice from 2008 to 2010.