Agriculture is dying in the Philippines

AS A MATTER OF FACT - Sara Soliven De

Guzman (The Philippine Star) - June 18, 2018 -
12:00am
Agriculture is dying. This is a sad reality of the country.

Agricultural land is being developed into industrial areas, shopping malls

and subdivisions. Farmers are growing old and their children have shifted
into other careers. The agriculture industry has not progressed in ages.
Many of our agricultural schools are producing office-oriented workers who
would much rather do paper work than help improve the agricultural sector
of the country. Not to mention the many horror stories of corruption at the
Department of Agriculture.

Even if the Philippines is primarily an agricultural country, we have not done

anything to ‘cultivate’ this sector. In the sixties, we were ahead in Asia.
Students from different countries came here to study agriculture and its
technology. But what happened? They are now better than us. Somehow,
we lost in the race.

Yes, we have been blessed with different kinds of bodies of water, lands
that are lush and fertile, and a climate that is favorable in growing various
kinds of high valued crops and raising livestock, poultry and other farm
animals. But due to economic industrialization, this industry has been
challenged. Our priorities have changed almost forgetting our fundamental
need for survival. And according to reports, the agricultural sector employs
only 25.96 percent of the Filipino workers as of November 2017. This is
very low compared to many countries who prioritize and give more
importance to it.

Agriculture plays an important role in the country’s economy. This is

measured as the value added of the agricultural sector as percent of GDP.
According to the World Bank data from 1960 to 2016, the average value for
the Philippines during the period was 21.36 percent with a minimum of 9.65
percent in 2016 and a maximum of 31.06 percent in 1974. This shows a sad
truth that the percent of GDP (value added) contributed from the agriculture
sector continues to decrease. Although people still think of the Philippines
as an agricultural economy, strictly speaking, and based on the data, this is
not the case.

The farmers lack support, training and a moral boost. First, they lack basic
skills in farming. Many are not educated or are only elementary graduates.
Second, good fertilizers, pesticides and seeds are imported from other
countries, making them very expensive and unaffordable for the lowly
farmer. Third, the government has not developed a good infrastructure for
farmers (i.e. farm-to-market roads, irrigation system, drying facilities and
milling centers, etc.). Fourth, most of our farmers do not own the land they
till. They cannot maximize the use of the land that results in low income.
And since they are just tenants, some landowners require a 50-50 share of
the product, thus leaving only half of the produce to the farmers. Fifth,
farmers have difficulty in financing their farming endeavors due to the high
rates of borrowing institutions. And when harvest time arrives, the money
from the sale is only enough to pay their debts and nothing is left for them.
Sixth, farmers lack protection from the middlemen who take advantage of
their weaknesses. The middlemen buy their products at a very low cost and
the Department of Agriculture always seems to be turning a blind eye on
these culprits.
During the Innovation Olympics 2018 held at the 8 Waves Resorts in
Bulacan last April, East-West Seeds Philippines general manager Henk
Hermans said that farmers represent the second poorest sector in the
country. This has resulted in the young people’s disenchantment in
pursuing a career in agriculture. He noted that the average age of Filipino
farmers is 57-59 years old and therefore there is a great need to encourage
the youth to engage in crop production to ensure the country’s food
security. He also pointed out that our farming practices are outdated, and
majority of the farmers are reluctant to use modern technology in farming,
making their work labor intensive and unsustainable.
The government has recognized the declining contribution of the agricultural
sector in the country’s GDP and this drop in its performance is attributed to
its vulnerability towards extreme weather events (drought and typhoons),
infestations (coconut scale insects), and poor adoption of high-yielding
varieties at the end of the farmers. The restricted crop production
diversification of farms particularly concentrating on rice, corn, and
sugarcane impedes the optimization of the land potential. Other
longstanding issues such as the limited access to credit and insurance, low
farm mechanization and inadequate postharvest facilities, inadequate
irrigation, limited support R & D, weak extension service, ageing farmers,
agrarian reform, limited connection between production area and markets,
poor compliance with product standards, competing land use, and weak
institutions have also been recognized. But we need action!
The Philippine Development Plan for 2017-2022 seeks to: expand
economic opportunities for those who are engaged in agriculture; increase
access to economic opportunities for small farmers. Based on the legislative
agenda, the development plan supports the following strategies to: abolish
irrigation service fees for small farmers; comprehensive Forestry Law and
delineation of Specific Forest Limits; amend the revised chapter of the
Philippine Crop Insurance Corporation to increase capital stock; amend
Presidential Decree No. 4 series of 1972 to separate the regulatory and
propriety functions of the National Food Authority; amend the Agriculture
Tarrification Act of 1996; provide guidelines for the utilization of coco levy
fund; pass the National Land Use Act to protect prime agricultural lands;
and genuine and comprehensive Agrarian Reform Program to distribute for
free without amortization agricultural lands to landless farmers and
agricultural workers (NEDA, 2017). So, what gives?

Last year the Department of Agriculture had a budget allocation of P46

billion. This year the budget is P60.6 billion. Next year, it is expected to go
up to P124 billion. Yes, the DA has the budget but they don’t seem to have
the brains and the balls to get things going. They continue to point fingers
on the past administrators. Every Agriculture Secretary has a reason for the
season. Sanamagan! Just do it!

UPLB Center for Technology Entrepreneurship executive director Glenn

Baticados said that agriculture today is more than just a farmer simply
planting a crop, growing livestock, or catching fish. He said, “It takes an
ecosystem and several actors to work together to produce and deliver the
food we need. It is this dynamic and complex ecosystem that will equip
agriculture to cope with the competing challenges of addressing food safety
and food security, creating inclusive livelihoods, mitigating climate change
and sustainably managing natural resources.”
Agriculture constitutes the foundation of food security. As such, it is
imperative that all concerned bodies work together, innovate continuously,
collaborate in research and development to meet future challenges in
agriculture.

The tragedy of the Filipino rice farmers

By
Zoilo ‘Bingo’ Dejaresco III
-
September 12, 2019
https://businessmirror.com.ph/2019/09/12/the-tragedy-of-the-filipino-rice-farmers/

TODAY there are 10 million rice farmers in the Philippines. Extrapolating their number of
dependents, they constitute a big portion of the over 100 million Filipinos today, and they
are in trouble.

Not much of their land can be reached by irrigation facilities and rain has not been heavy
on lands depending on rain for water.

On the other hand, the rice tariffication law (RTL, RA 11203), recently passed but lacking
yet in publicized IRR (implementing rules and regulations) is a good law. It thinks primarily
about food security for 100 million Filipinos rather than just protecting the parochial needs
of some 10 million Filipino rice farmers.

For decades, in the name of “protecting” the farmers, rice importation was limited by quota
restrictions. There was tons of money to be made, reportedly by bureaucrats who
approved the import allocation, the traders who cornered the importation permits and
which allegedly acted as a “cartel” in order to dictate market prices. And, of course, there
were the smugglers-scarcity being the mother of smuggling.

Divine intervention came last year when these market aberrations resulted in a price
supply deficit and prices of rice went to the roof-hiking inflation rate and negatively
affecting the gross domestic product (GDP). The government was shocked and, thus, the
RTL was born.
Today, the full effect of the law has not yet been felt generally by retail consumers
because as Agriculture Secretary William D. Dar said “although some 2.5 million tons of
rice have already been imported up to August,” the traders are withholding their market
entry in order to command higher prices. Dar had warned them on September 4 that the
full force of the law like “economic sabotage,” perhaps, can be meted on these
unscrupulous businessmen in Satan’s robe.

The average production cost of palay is at P12 per kilo. People from the mountains in
other rice-growing parts of the country say some greedy wholesalers there are buying
farm-gate palay at only P8 per kilo stealthily citing what is
happening in some parts of Luzon.

But Agriculture Committee Senate Chairman Sen. Cynthia A. Villar debunked the case
explaining that those being sold at P8 per kilo in Luzon were those that have been
severely damaged by the typhoon rain causing unwanted moisture.

Buying palay at P8 per kilo will certainly kill the poor farmer, who is forced to agree to this
confiscatory price just to be able to pay for the children’s schooling, have food money for
the family and buy the seeds for the next planting.

Can one-fathom cruelty as offensive as this? There are those who pretend to “help” the
farmers in need but the financial arrangement is such that in the medium term, the poor
farmer will be so much buried in obligations that he is forced to give up his land as
payment.

We have heard of those who are now landed “oligarchs” precisely by “helping” farmers
this way.

Local government units should start buying palay at P20 per kilo (average) to stymie
these greedy traders. Dar said LGUs, after all, are autonomous and a mere resolution of
their local legislative bodies can authorize the LGU officials to borrow from LandBank and
buy palay from farmers at P15 per kilo to 17 per kilo (above production cost) and certainly
way above the “criminal” rate of P8 per kilo.

This is necessary because the government cannot use their present approved local 2019
budget because no such specific appropriation exists and using such funds would be
technical malversation.
If any funds are left, NFA can also buy, we believe, palay at about the same P20.70 per
kilo, as well. But farmers are not enthused to sell to the NFA because of the tedious
processes in the collection of payment.

It is important the government acts with dispatch because the so-called Rice
Competitiveness Enhancement Fund (RCEF) of P10 billion will still be implemented only
in the 2020 budget of the DA.

The P10-billion funds to be distributed to the aggrieved farmers are without interest for six
years but their usage is limited to just seed distribution and machinery. What about
working capital, sir?

After helping the farmers from the above, will be RTL benefit the rice-eating populace of
over 100 million Filipinos? Yes, but not yet perfectly now.

Philippine Statistics Authority shows that today—on average—regular milled rice is still
priced at P38.40 and well-milled rice at P43.50, lower than last year but not yet at the
government targeted retail price of P27 per kilo of regular milled rice.

Currently, in some areas, palay at farm-gate is bought by traders (not the unscrupulous
ones) at P19 per kilo to P20 per kilo and wet type at P17 per kilo to P18 per kilo.

The government buying palay price at P20 per kilo to P22 per kilo for now, therefore,
would be of big help. With retail price currently at P38 per kilo, there are enough margins
to be shared among the trader, retailer and even the government to pay for LandBank’s
interest.

The point is that government must have the correct moral posture—of placing its heart
nearest the interest of the poorest sectors of society, which include our millions of rice-
industry dependent Filipinos (P150 daily income for a family of five?).

Bingo Dejaresco, a former banker, is a financial consultant, media practitioner, and book
author. He is a life member and broadcast chair of Finex, His views here, however, are
personal and do not necessarily reflect those of Finex. [email protected]
The Rice Tariffication Law and Our Struggling
Farmers: Who is to Blame?
For an agricultural country, it’s our farmers that
suffer in the most.

By ANRI ICHIMURA | Sep 9, 2019

Months prior to the passing of the controversial Rice Tariffication Law on February 15,
2019, analysts warned of the drastic toll the law would take on farmers—one of the
marginalized groups in an ironically agricultural country. Their warnings proved true as
seven months on, farmers across the country are struggling to make ends meet with the
farmgate price for palay hitting record lows.

The struggle of the Filipino farmer is one that has lasted for decades, if not centuries. Yet
the consequences of the Rice Tariffication Law have exacerbated their situation to new
extremes. Empathetic to their struggle, Filipinos have been quick to point fingers at the
senators (or mainly, senator, singular) who authored the bill, but the Rice Tariffication
Law is more complicated than the black and white picture social media portrays. Here’s
why:

What is the Rice Tariffication Law?

Before we deconstruct the law, we need to understand it. Consider the Rice Tariffication
Law (Republic Act 11203) the unli-rice import order.

It allows for the removal of import quotas, taking off the cap on rice imports and allowing
foreign rice to flood the local market—but only if importers can pay the price. Also dubbed
the Rice Liberalization Law, it places a 35 percent tariff on imported rice coming from
ASEAN countries and a 40 percent tariff on non-ASEAN countries.

President Rodrigo Duterte signed the bill into law in response to the insane price hikes of
rice that took place in 2018 when rice hit as much as P70 per kilo. The law is intended to
lower the price of rice by increasing supply, but no one accounted for it to plunge to as low
as P7 per kilo.

What did the Philippines promise?

The bill was authored by Senator Cynthia Villar, who bears the brunt of the backlash from
farmers and netizens alike. However, Villar says that the law was created to fulfill
the country’s obligation to the World Trade Organization (WTO), of which the Philippines
has been a member since 1995.

By becoming a member of the WTO, the Philippines agreed to lift all trade barriers, like
quotas, in place of tariffs—with rice as the only exception. The Philippines’ 1995
agreement with the WTO states that the Philippines would be allowed to control the
importation of rice through quotas to protect Filipino farmers, on the condition that the
Philippines would work on developing its farmers for global competitiveness for the
duration of the agreement. The agreement expired in 2005, but was extended until 2012
and again until 2017.

“We (lawmakers) did not decide on the importation of rice. We signed an agreement in
1995 with WTO, they will allow us to control the importation of rice for 22 years to
prepare our farmers to become competitive to the imported rice, and this expired in
2017,” Villar said.

After numerous extensions, the government finally decided to fulfill its obligation to the
WTO by filing the Rice Tariffication Bill, thus lifting the import limits on rice.

Some would argue that the Rice Tariffication Law was inevitable—that the Philippines had
to eventually fulfill its part of the bargain. But critics argue that the Philippines could have
simply filed for another extension or exemption.

“There was nothing to stop us from asking for another waiver or extension after July
2017,” argued Raul Montemayor, national manager of the Federation of Free Farmers. “Of
course, this would have required us to give additional concessions to some WTO member-
countries, some of which may have not been acceptable. But the government just decided
not to negotiate anymore for another extension and just remove the QRs. So, it was not
true that the WTO forced us to tariffy rice. It was our own decision.”

So who is to blame?
Villar, who won the most votes in the 2019 midterm elections, was arguably among one of
the most popular senators at the start of her term. However, the Rice Tariffication Law has
attracted a growing number of critics as many netizens have called her out for certain
comments she made during a senate hearing, claiming that P21 per kilo of rice (which
would earn a farmer roughly P5,500 per month) was “too much” to ask for.

But who is really to blame? Is it the WTO? The Philippine lawmakers who signed the
agreement in 1995? The senator who authored the law?

It’s easy to blame one person for the surmounting struggles that farmers have been facing
for years, but in reality, it’s systematic negligence that is at fault. The agreement was
signed 24 years ago, which is enough time to fulfill the Philippines’ promise to improve the
local rice industry. Yet, over the course of 24 years, five administrations, and 14 agriculture
secretaries, the rice industry was still not prepared when the expiration date hit. As a
result, a law was hastily signed to make up for 24 years of lost time. And now it’s the
farmers that have to deal with the brunt of the consequences.

Lack of preparation is certainly to blame, caused by negligence that farmers are all too
familiar with. But lack of foresight cannot be used as an excuse for the situation that
farmers are now in. Lawmakers should have been aware of the impact this would have on
the ground—analysts warned this would happen and the farmers who are now on the
brink of selling their land are proving them right.

What can be done?

As mandated by the Rice Tariffication Law, the P10 billion per year Rice Competitiveness
Enhancement Fund (RCEF) is meant to use the taxes from the tariffs to fund mass
irrigation, rice storage, and research initiative programs for the benefit of farmers. But the
fund, which is the law’s main safety net for farmers, is already facing controversy as the
senate is questioning where P4 billion allocated to help farmers went.

However, one analyst claims that the problem lies in the tariff level being at only 35
percent, suggesting that it can be increased if the volume of imports becomes too high.

On the consumer side, citizens can purchase rice directly from rice farmers in their local
communities at reasonable prices (such as P20 per kilo), and urge their schools,
companies, and communities to follow suit. You can also download the app Session
Groceries, which will soon guide you to a Filipino rice farmer who you can purchase from
directly.

Months prior to the passing of the controversial Rice Tariffication Law on February 15,
2019, analysts warned of the drastic toll the law would take on farmers—one of the
marginalized groups in an ironically agricultural country. Their warnings proved true as
seven months on, farmers across the country are struggling to make ends meet with the
farmgate price for palay hitting record lows.

The struggle of the Filipino farmer is one that has lasted for decades, if not centuries. Yet
the consequences of the Rice Tariffication Law have exacerbated their situation to new
extremes. Empathetic to their struggle, Filipinos have been quick to point fingers at the
senators (or mainly, senator, singular) who authored the bill, but the Rice Tariffication
Law is more complicated than the black and white picture social media portrays. Here’s
why:

What is the Rice Tariffication Law?

Before we deconstruct the law, we need to understand it. Consider the Rice Tariffication
Law (Republic Act 11203) the unli-rice import order.

It allows for the removal of import quotas, taking off the cap on rice imports and allowing
foreign rice to flood the local market—but only if importers can pay the price. Also dubbed
the Rice Liberalization Law, it places a 35 percent tariff on imported rice coming from
ASEAN countries and a 40 percent tariff on non-ASEAN countries.

President Rodrigo Duterte signed the bill into law in response to the insane price hikes of
rice that took place in 2018 when rice hit as much as P70 per kilo. The law is intended to
lower the price of rice by increasing supply, but no one accounted for it to plunge to as low
as P7 per kilo.

What did the Philippines promise?

The bill was authored by Senator Cynthia Villar, who bears the brunt of the backlash from
farmers and netizens alike. However, Villar says that the law was created to fulfill
the country’s obligation to the World Trade Organization (WTO), of which the Philippines
has been a member since 1995.
By becoming a member of the WTO, the Philippines agreed to lift all trade barriers, like
quotas, in place of tariffs—with rice as the only exception. The Philippines’ 1995
agreement with the WTO states that the Philippines would be allowed to control the
importation of rice through quotas to protect Filipino farmers, on the condition that the
Philippines would work on developing its farmers for global competitiveness for the
duration of the agreement. The agreement expired in 2005, but was extended until 2012
and again until 2017.
“We (lawmakers) did not decide on the importation of rice. We signed an agreement in
1995 with WTO, they will allow us to control the importation of rice for 22 years to
prepare our farmers to become competitive to the imported rice, and this expired in
2017,” Villar said.
After numerous extensions, the government finally decided to fulfill its obligation to the
WTO by filing the Rice Tariffication Bill, thus lifting the import limits on rice.

Some would argue that the Rice Tariffication Law was inevitable—that the Philippines had
to eventually fulfill its part of the bargain. But critics argue that the Philippines could have
simply filed for another extension or exemption.

“There was nothing to stop us from asking for another waiver or extension after July
2017,” argued Raul Montemayor, national manager of the Federation of Free Farmers. “Of
course, this would have required us to give additional concessions to some WTO member-
countries, some of which may have not been acceptable. But the government just decided
not to negotiate anymore for another extension and just remove the QRs. So, it was not
true that the WTO forced us to tariffy rice. It was our own decision.”

So who is to blame?
Villar, who won the most votes in the 2019 midterm elections, was arguably among one of
the most popular senators at the start of her term. However, the Rice Tariffication Law has
attracted a growing number of critics as many netizens have called her out for certain
comments she made during a senate hearing, claiming that P21 per kilo of rice (which
would earn a farmer roughly P5,500 per month) was “too much” to ask for.

But who is really to blame? Is it the WTO? The Philippine lawmakers who signed the
agreement in 1995? The senator who authored the law?

It’s easy to blame one person for the surmounting struggles that farmers have been facing
for years, but in reality, it’s systematic negligence that is at fault. The agreement was
signed 24 years ago, which is enough time to fulfill the Philippines’ promise to improve the
local rice industry. Yet, over the course of 24 years, five administrations, and 14 agriculture
secretaries, the rice industry was still not prepared when the expiration date hit. As a
result, a law was hastily signed to make up for 24 years of lost time. And now it’s the
farmers that have to deal with the brunt of the consequences.
Lack of preparation is certainly to blame, caused by negligence that farmers are all too
familiar with. But lack of foresight cannot be used as an excuse for the situation that
farmers are now in. Lawmakers should have been aware of the impact this would have on
the ground—analysts warned this would happen and the farmers who are now on the
brink of selling their land are proving them right.

What can be done?

As mandated by the Rice Tariffication Law, the P10 billion per year Rice Competitiveness
Enhancement Fund (RCEF) is meant to use the taxes from the tariffs to fund mass
irrigation, rice storage, and research initiative programs for the benefit of farmers. But the
fund, which is the law’s main safety net for farmers, is already facing controversy as the
senate is questioning where P4 billion allocated to help farmers went.

However, one analyst claims that the problem lies in the tariff level being at only 35
percent, suggesting that it can be increased if the volume of imports becomes too high.
On the consumer side, citizens can purchase rice directly from rice farmers in their local
communities at reasonable prices (such as P20 per kilo), and urge their schools,
companies, and communities to follow suit. You can also download the app Session
Groceries, which will soon guide you to a Filipino rice farmer who you can purchase from
directly.

The irony can’t be lost in our situation—a primarily agricultural country that struggles in
sustaining its farmers. Perhaps it would do well to remember this Polish proverb when it
comes to the Rice Tariffication Law and all other measures that impact farmers: “If the
farmer is poor, then so is the whole country.”