Marjuice Destinado

From a nation that once thrived on its own rice fields, the Philippines now chokes on imported grains, earning the title of the world's top rice importer.


The Philippines has once again claimed the title of the world’s top rice importer, as local production struggles under the devastating effects of El Niño, La Niña, and recent typhoons, according to the latest monthly global grains market report from the United States Department of Agriculture (USDA).

Projected to remain the world’s largest rice importer for the third consecutive year, the Philippines is expected to see its total rice imports reach 4.7 million metric tons (MT) this year. According to the latest Grain: World Markets and Trade report from the USDA - Foreign Agricultural Service (FAS), this figure marks a 2.2 percent increase from the previous estimate of 4.6 million MT. This rise is largely driven by strong demand for rice from Vietnam, which has become a preferred supplier due to its competitive pricing and proximity.

The Green Revolution

The Philippines was once self-sufficient in rice production. The introduction of modern rice technology and investments in irrigation in the second half of the 1960s led to an average annual growth rate of 5.9% in rice production during the 1970s. However, rapid population growth, shrinking agricultural land, and worsening climate-related issues have driven a decline in local rice yields. 

The Green Revolution, which transformed Philippine agriculture from the 1960s to the 1980s, began with the establishment of the International Rice Research Institute (IRRI) in 1960, leading to the development of high-yielding rice varieties like IR8 and a surge in rice production from 3.7 million tons in 1966 to 7.7 million tons by 1981, allowing the Philippines to become an exporter of rice and significantly improving food security.

However, the optimism of this period was short-lived, as economic crises, political instability under Ferdinand Marcos Sr., and natural disasters such as Typhoon Katring in 1984 led to a decline in local rice production, causing the Philippines to transition from a rice exporter to a net importer by the early 2000s.

By the mid-2000s, rising population pressures, increasing production costs, and the impacts of climate change further deepened the country’s reliance on rice imports. The self-sufficiency ratio plummeted from 95% in 2016 to just 77% in 2022, while the Rice Tariffication Act of 2019 lifted import restrictions and flooded the market with cheaper foreign rice, threatening local farmers' livelihoods.

Rice Tariffication Act

On February 14, 2019, President Rodrigo Duterte signed the Rice Tariffication Act (Republic Act No. 11203), a landmark legislation intended to liberalize rice imports by replacing quantitative restrictions with tariffs of 35% to 50%, a response to the soaring rice prices that had fueled inflation in late 2018 when the National Food Authority (NFA) faced stock shortages.

However, this significant policy shift has drastically impacted the Philippine agricultural sector, resulting in the country becoming the world's largest rice importer, surpassing China.

Danilo Ramos, chair of the Kilusang Magbubukid ng Pilipinas (KMP), criticized the Rice Tariffication Law (RTL), stated that it “endangered the welfare of both producers and consumers. It undermined the livelihoods of millions of rice farmers and pushed many into hunger, bankruptcy, and indebtedness, while retail prices remain unaffordable to poor families.” 

The KMP warns that the Rice Tariffication Law is nothing short of a “death warrant” for the local rice industry, as it threatens to open the floodgates to foreign competition that could overpower and “wipe out” local rice farmers. This dire situation could impact approximately 500,000 of the Philippines' 2.4 million rice farmers. 

Instead of uplifting local producers, the surge of cheaper imported rice has devastated domestic prices. While consumers have seen some savings—about ₱38.6 billion from lower retail prices—these benefits primarily favor importers and retailers, not the local producers who feed the nation.

The Promise and Peril of Marcos' Agreements with Vietnam

As of September 12, 2024, data from the Bureau of Plant Industry (BPI) reveals that about 3.01 million metric tons of imported rice have arrived in the Philippines, with 2.36 million metric tons (or 78 percent of the total) sourced from Vietnam.

In January 2024, the Philippines and Vietnam solidified their agricultural partnership by signing a memorandum of understanding (MoU) that commits Vietnam to supply between 1.5 million and 2 million metric tons of white rice annually to the Philippines over the next five years. This agreement, finalized during President Ferdinand R. Marcos Jr.’s state visit to Vietnam, aims to provide the Philippines with a reliable source of rice at “competitive and affordable prices.”

The combination of the MoU with Vietnam and the tariff reductions creates a complex market dynamic for rice. While consumers can enjoy lower prices due to increased imports, local farmers may struggle to compete against these cheaper options, potentially exacerbating rural poverty among those who depend on rice farming for their livelihoods. 

Tariff Reduction

In June 2024, President Ferdinand Marcos Jr. signed Executive Order No. 62, which lowered tariffs on imported rice from 35% to 15% until 2028. This policy aims to reduce retail prices by approximately ₱6 to ₱7 per kilogram, making imported rice more competitive than local varieties. 

The tariff cut is part of a broader strategy to temper inflation, which has been exacerbated by high food prices. Rizal Commercial Banking Corporation chief economist Michael Ricafort noted that reducing the tariff could lower headline inflation by about 0.36%, given that rice accounts for nearly 9% of the consumer price index. However, while consumers may benefit from lower prices, local farmers face challenges as they compete with cheaper imported rice.

Leading up to the tariff reduction, rice imports had decreased significantly, averaging only 176,000 metric tons per month in June and July 2024. However, by August 2024, imports surged to 385,000 metric tons as traders anticipated potential supply shortages due to El Niño.

The Federation of Free Farmers expressed concerns that traders might not pass on savings from reduced tariffs to consumers, thereby maximizing profits instead. This situation could lead to further economic hardships for farmers who are already struggling with fluctuating prices for palay (unmilled rice), which have recently dropped due to anticipated oversupply during the harvest season. If local palay prices continue to decline—reported between ₱16 and ₱25 per kilogram—farmers could be shortchanged as new harvests coincide with cheap imports.

Implications for Food Security and Economy

The economic impact of increased rice imports means that the Philippines spends more on buying rice from abroad, affecting the national economy. While this helps stabilize local rice prices and ensure food availability, it also means using valuable foreign exchange reserves to purchase rice instead of investing in other sectors. 

Moreover, the reliance on imported rice raises concerns about long-term food security. It exposes the Philippines to vulnerabilities associated with global market fluctuations, including sudden price hikes or export restrictions imposed by supplier countries. Such dependencies can destabilize the local economy, making it increasingly difficult for the nation to manage its food supply effectively.

In conclusion, the Philippines’ reckless strategy of increasing rice imports may provide a fleeting sense of relief for consumers. The temporary reduction in rice prices might seem like a win amidst rising costs, but this approach sows seeds of uncertainty for the nation’s food security and economic stability.

By prioritizing cheap imports, the government is systematically eroding local production capabilities, pushing farmers deeper into poverty while leaving them vulnerable to the unpredictable tides of global rice markets.