It’s nice to hear that the Department of Agriculture is listing some food products with Suggested Retail Prices.
Question is: do SRPs, especially on food items bought mostly in wet markets, work?
The announcement, which raised high hopes among so-called consumer groups that prices could be tamed by SRPs, stated that the Department of Trade and Industry would help DA monitor the prices of rice, poultry, certain types of fish, among others.
The devil is in the monitoring and the compliance. There are thousands of wet markets, and thousands of supermarkets, not to mention groceries all over the country. If they enlist the local government units, would that give consumers reassurance? Don’t bet on it. Market vendors are potent political constituents, organized too.
In the case of rice, the problem is more basic. Rice is a fungible commodity.
Which means it is very difficult for the ordinary consumer to distinguish regular-milled from well-milled rice.
Even the so-called rice “brands” are not as different from one another as the brand name implies. How good is the denorado or dinorado that one buys? I used to buy dinorado in Davao that was a bit pinkish-hued in color, so sweet-smelling, and so tasty.
Here in Manila, the dinorado bought in one market differs from the next, even in the supermarkets. And they are as tasteless as can be.
Or “sinandomeng,” the queer name of which makes me wonder about provenance or creative branding. What difference there is in taste or quality between the so-called dinorado and the so-called sinandomeng one can hardly discern.
When I was a small kid, my lola and my mom were so choosy about the kind of rice we had in the house. “Milagrosa” was then the prized rice variety, and we got our supply from Bulacan every harvest time, or from our relatives in Nueva Ecija.
That has disappeared from the market. But that’s another story.
NFA sells regular-milled rice at P27 pesos per kilo, and well-milled at P32. Ask the ordinary consumer if the difference is so palpable.
NFA imports 25-percent “brokens,” which means 75 percent of the rice is whole, with the fourth broken during the milling. That’s because it is cheap, about $10 to $15 per metric ton cheaper than 15-percent brokens, depending on the harvest volume.
Bulog, the NFA’s counterpart in Indonesia, once tried importing 25% brokens from Vietnam, but the choosier Indonesian consumers protested. Try eating rice in Jakarta, even in the fast food outlets, and see, smell and taste the difference.
Here, whether in the popular food chains or in the carinderias, the rice they serve is decidedly of lower quality.
But this article is not about food quality, but how the SRP can be circumvented in rice by the simple expedient of adulteration.
A retailer or rice trader can mix “good” rice with “bad” in different proportions and pass the same off as good rice. Would the ordinary consumer, unless he is Tunying Taberna or Gerry Baja who grew up among the rice fields of Nueva Ecija, be able to discern the adulteration?
Prices can follow the SRP, but the consumer is nonetheless fooled, and the seller makes bigger profits. Why so? Simply because rice is a fungible commodity. It is in the nature of the product.
Think of poultry. How often have you bought chickens that weigh a kilo in the market, only to find it weighing 900 or 950 grams when you get back to your house thirty minutes after? The trick is in ice inside the cavity.
Product standards in the country are not as strictly enforced here as in other countries. Neither is there as much “fear of the law.”
During the early martial law years, price controls were effective, but only for a time. “Back-sliding,” as then-President Marcos called it, became more pronounced as martial law aged.
The NFA at a time went into retailing more than just rice, and established Kadiwa stores in the metropolis, selling fish, meat, poultry and vegetables. Politically nice, optics-wise, but a huge financial flop. Government lost a lot of money; perishables went into trash.
Government will never be good at business, especially in retail. With government accounting and auditing rules, business decisions will always be difficult and cost-ineffective.
Take our government-owned and managed Duty Free stores in our airports. Compare with those that are privately managed in Hong Kong, or Taipei, Singapore or Auckland, and weep.
Out-of-fashion merchandise, brands that no longer sell elsewhere (and even here because many Filipinos have become exposed to travel to other capitals), and more retail horrors. Privatization is the best solution.
Markets are governed by the law of supply and demand, and price equilibrium is always reached by supplying more to meet the proper demand. Governments can intervene through consumer regulation of product standards, but it can only do so much.