Philippines May Benefit From India’s Removal of Minimum Export Price on Rice
The Indian government recently scrapped the floor price on its rice exports and the Philippines stands to benefit from the move.
During the recently held World Rice Conference in Pasay City, Philippines, Rowena Sadicon, founder of the Philippine Rice Information System stated that the removal of the minimum export price (MEP) for India’s non-basmati white rice exports “comes at a critical time” as recent typhoons damaged rice plantations in the country.
In her speech, Sadicon said, “This move may allow the Philippines to import more affordable rice, helping to stabilize prices and prevent potential shortages.”
It was in July 2023 when India imposed a ban on exporting non-basmati rice to keep domestic prices low and to secure the country’s supply ahead of elections. After 14 months, India lifted the export ban on non-basmati white rice and set an MEP of USD 490 per ton.
Last month, the Indian government removed the export price to improve the income of farmers while boosting overseas shipments.
“While this development provides immediate relief, it’s crucial to balance imports with local production support to protect our farmers. Excessive imports could harm local farmers, especially if production costs remain high,” said Sadicon.
She also stated that consumers found relief from the reduction of rice tariffs as retail prices dropped by PHP 5 to 7 per kilogram. However, according to her, farmers have shouldered the brunt of global market factors affecting local prices as palay prices declined to PHP 22 to 24.50 per kg.
Data from the Bureau of Plant Industry showed that as of October 31, the Philippines imported 3.79 million metric tons (MT) of rice, surpassing last year’s import volume of 3.6 million MT. Vietnam topped the list of rice suppliers, supplying nearly 3 million of the total. Thailand followed with 470,273.38 MT, and Pakistan was third at 175,174.48 MT.
India delivered 22,058.64 MT more than a month after lifting the rice export moratorium, although it was higher than the 13,794.63 MT the country exported in 2023. Sadicon added, “Our focus remains on supporting local farmers while responsibly managing imports to secure long-term,” echoing the group’s push for accessible data to accurately predict the domestic supply and demand of rice.
The El Niño weather and the combined effects of typhoons Kristine and Leon heavily weighed on the agriculture sector. Currently, the damage to rice has climbed to billions of pesos. Department of Agriculture Assistant Secretary Arnel de Mesa said that the severe impact of the recent typhoons and the El Niño phenomenon on the farm sector is expected to reduce the Philippines’ palay output this year.
