BY JOB REALUBIT

THE agriculture department yesterday said it has secured P12 billion credit line from the Land Bank of the Philippines to support rice price stabilization and to boost rice production and other food crops.

Of the amount, P5 billion will go to farmers in the country’s palay-growing areas, said Undersecretary Bernie Fondevilla, director of the National Agriculture and Fisheries Council.

Ago Apilado, Land Bank vice president for corporate affairs, said the P5 billion allocation will be used to procure fertilizers and palay seeds and fund other farming-related aspects for rice planting.

Fondevilla said the P12 billion credit facility is on top of other measures proposed by Malacañang and the DA to stabilize rice prices, which include allowing the private sector to engage in rice imports, lowering tariffs on imports, and making the National Food Authority engage in the direct or supervised selling not only of government-subsidized rice but of medium-priced varieties as well.

The rest of the fund, according to Fondevilla, will go to livestock production (P2.54 billion), high-value commercial crops (P2 billion), industrial crops like rubber and oil palms (P1.5 billion), the fisheries sector (P700 million), and corn production (P300 million).

Fondevilla said LandBank president and CEO Gilda Pico has told the DA the institution is ready to extend more financial support if there is a big demand for credit assistance from qualified farmers’ organizations such as cooperatives and from the small and medium enterprises.

Last year, LandBank released P2.92 billion to help boost palay harvests and P210 million for corn production, benefiting more than 47,000 farmers.

According to Pico, LandBank lent P26.8 billion to the agriculture sector last year.

Fondevilla said the bank has also allocated P120 million for the DA’s hybrid rice program.

A coalition of farmers and non-government organizations said opening up rice importation to the private sector now would benefit only "the same unscrupulous traders suspected of repacking NFA rice that are mixed with the commercial rice and sold at a higher price."

It would also lead to further jacking up of prices, said Jessica Reyes-Cantos, lead convenor of Rice Watch and Action Network (R1).

Agriculture Secretary Arthur Yap has discussed with Finance Secretary Margarito Teves the possibility of opening rice imports to the private sector and relaxing tariffs on the staple.

Former Planning secretary Felipe Medalla on Friday said government should end its control of rice importation to end rice cartels, personalities behind which he said are "closely linked to government operations."

The World Bank likewise recently said that lowering the tariff for rice importation would benefit the majority of Filipinos, especially the urban poor.

Cantos said the current price of $747 per metric ton in the international market means P32 per kilo in the local market with a zero tariff, P39 at 10 percent tariff, P36 at 10 percent tariff, and P46 at 40 percent tariff.

She proposed allowing "genuine farmers groups" to import rice to enable them to benefit and recoup losses from production shortfalls.

Cantos challenged Yap to prove government’s pronouncement there is no rice crisis. "Bring down the prices of rice in the market," she said.

Sen. Loren Legarda urged Malacañang to certify her bill that seeks to privatize rice importation and allow farmers’ groups to import the grain.

Legarda’s Senate Bill 1081 was filed last year. Senate President Manuel Villar Jr. recently introduced a similar measure, Senate Bill 1897. Nueva Ecija Rep. Eduardo Joson has filed a counterpart bill.

Legarda’s bill effectively privatizes rice importation, thus allowing the NFA to concentrate on buying at market prices the grain produced by local farmers.

The bill seeks to amend Presidential Decree 1770, which gave the NFA the sole power to import the staple.

Legarda also expressed fears the surge in the price of regular commercial rice is bound to set off increases in the prices of other basic commodities.

"We definitely see heightened risk of runaway inflation, should ordinary rice retail prices persist at P27 to P30 per kilo for an extended period," said Legarda, chairwoman of the Senate economic affairs committee.

Legarda also said she sees the Bangko Sentral ng Pilipinas revising upward this year’s projected inflation rate, mainly on account of the increased risk posed by soaring rice prices.