Resolving the food shortage

By Maria Althea Teves,

Posted at Jul 30 2009 03:41 PM | Updated as of Jul 31 2009 03:02 AM

MANILA - To deal with the soaring price of rice in 2008, the government decided to heavily import. Economists, however, say the practice of government importing rice did more than good.

Akbayan Rep. Walden Bello said importing food displaced rural workers by the hundreds of thousands. "Under the guise of consumer sovereignty, they are creating a crisis for local food producers and in the long run, hunger and poverty worsens,” Bello said.

Bello is also with the Food First USA, an institution for food and develop policy.

The state-run National Food Authority (NFA) buys rice mostly from Thailand and Vietnam at commercial rates. These are then sold to the poor at a lower price. The government subsidizes the price difference.

Former agriculture secretary Arsenio Balisacan said that instead of stabilizing prices, which is NFA's mandate, the NFA rice contributed to more instability in the price of goods across regions and provinces as the agency obtained rice from regions will little supplies to sell in regions with large supplies.

“NFA affects prices, but more on negative than the positive,” said Balisacan.

He added that when it comes to buying from local producers, his studies about the NFA rice showed that the government buys from areas where there is little supply of rice and sell it to areas to regions with excess supply.

He said that they might have done this out of convenience. “Intentional or not, we don’t know. But, what is surprising is that the process is quite systematic and has happened over a couple of years,” Balisacan said.

Their procurement and release studies show that the practice has been done ever since National Grains Authority changed its name to NFA.

That kind of procurement and release, Balisacan said, destabilizes prices all over the country.

What the government could have done to lower food prices, according to the economists is to improve the competitiveness of agriculture sector.

Competitiveness meant increased productivity. Increasing productivity meant being able to achieve the same or higher output at a lower cost. This in turn can be achieved if the government subsidizes production cost.

This could be done through modernization and appropriate use of technologies by the agriculture sector.

Blaming the country's climate and geographic location for its poor food production – as Arroyo has done – is inexcusable, Balicasan said. The government should invest in “technological options for farmers,” he said, referring to “infrastructure, irrigation, proper seeds, good implementation and adaptation research.”


The Agriculture and Fisheries Modernization Act (AFMA) is supposed to provide appropriate technologies to farmers and fisher folk. P20-B is embarked annually for the implementation of AFMA until 2015.

Agrarian Reform undersecretary Narciso Nieto said that two government units—the agriculture and agrarian reform departments–allocate funds in efforts to modernize the agriculture system of the Philippines.

To its credit, the Arroyo administration did line up a number of programs to improve agricultural yield. FIELDS program stands for “Fertilizer, Irrigation and other rural infrastructure, Extension, Research and farmers' education, Loans, Dryers and other postharvest facilities, and Seeds.” It was launched mid-2008 under the AFMA program.

P5 billion is allotted for extension of services, research and development and training of farmers on new technologies that aim to lower production cost and at the same time increase yield.

Part of FIELDS is the Arroyo administration’s push for the use of imported hybrid rice seeds to increase palay output.

FIELDS program targeted to lend P1.1 billion in 2008 through its Hybrid Rice Financing Facility. This would help farmers acquire and hybrid seeds and know how to use them properly. As of the second quarter 2008, the financing facility was able to help 100,027 farmers and fisher folks in Cagayan Camarines Sur, Leyte, Nueva Ecija, Kalinga, Pangasinan, Isabela, Oriental Mindoro and Sultan Kudarat.

Under the same program, the current administration is spending P6 billion a year on irrigation. In the Arroyo’s 2008 SONA, PGMA proclaimed that irrigation has been extended to 1.5 million hectares.
Nieto said that productivity improved in areas where DAR intervened to modernize agriculture technologies, built farm-to-market roads and irrigated lands. “Farmers’ rice yield is only 80-90 cavans per hectare. But in areas developed by DAR, 100-120 cavans are produced per hectare.”

Real gains?

But did modernization programs really provide gains for the farmers?

Because the “government was in a hurry to show results” there were regions wherein the subsidized hybrid seeds used were not effective, Baliscan said.

Instead of meeting the expected yield, some farmers lost money. “We short circuited the process of introducing technologies,” Balisacan said. He added that the seeds should have been tested first in different areas to check its reactions to climate change and pests. “We have to do more applied research” to maximize production, he said.

As to irrigation, “she’s so proud although this has been done already in the Marcos era,” said Bello. Irrigated areas so far are just one-half of the total irrigable land area in the Philippines (3.13 million hectares).

Undersecretary Nieto also questioned why the Philippines is still importing despite performance of certain farmers, “We are a rice producing country. And results show that our farmers are able to produce large quantities with the help of the government, I personally could not understand the need for importation.”- By Maria Althea Teves,