Yap: RP's 2009 rice imports won't top 2M tons

Reuters

Posted at Feb 10 2009 05:52 PM | Updated as of Feb 11 2009 03:56 AM

The Philippines' rice imports this year will not exceed 2 million tons, with the government holding ample stocks of the grain to curb any possible rise in domestic prices, Agriculture Secretary Arthur Yap said on Tuesday.

In January, the Philippines, the world's biggest rice importer, and Vietnam forged a deal for the latter to supply it with 1.5 million tons of rice this year, with an initial 500,000 tons due to arrive this month and the next, in a bid to avert last year's price flare-up triggered by Manila's open tenders.

Rice prices trebled to hit a record peak of $1,080 a ton in May last year, when governments and importers rushed to stock up the grain on fears the food staple would be in short supply amid high domestic inflation. Prices have since receded by half.

"We are still going to import in 2009 but we are going to be importing less than in 2008," Yap told reporters. "In 2008, we imported more than 2 million tons. I don't see us importing more than 2 million tons (in 2009), that would be tops already."

Yap did not say where the remaining 500,000 tons of rice would come from.

Vietnam said last week it expected to export 1.5 million tons of rice to the Philippines this year, confirming the size of the massive deal that boosted export quotations.

Manila imports about 10 percent of its annual rice requirements.

Yap said the National Food Authority (NFA), the state-run firm tasked with importing the grain and ensuring stability in domestic prices, held enough supplies of rice.

"We do not see a situation of spiking prices as we did in 2008 because the NFA is better prepared in 2009 than it was in 2008," he said.

NFA administrator Jessup Navarro said on Monday the agency's rice stocks stood at nearly 844,000 tons, equivalent to around 26 days' worth of consumption.

That compared with just eight days' worth of stocks in the same period in 2008, when Manila's massive 2.3 million ton rice import helped propel benchmark Thai rice to its record peak.

The NFA is aiming to buy around 1 million tons of unmilled rice from local farmers this year after purchasing 685,300 tons in 2008, the highest in almost three decades.

Analysts have said the global rice market was likely to see a period of plentiful supply and price stability after last year's volatility following Manila's deal to secure the bulk of its rice supplies for 2009 at one go and India's imminent move to resume exports.