p h i l i p p i n e r i c e i n d u s t r y p r i m e R s e r i e s

ISSN 20944-9200

ta b l e o f c o n t e n t s Paddy Rice (Palay) Production, 1970-20101 Growth in Paddy Rice Production, 1970-20102 Growth in Paddy Rice Production, by Semester/Ecosystem, 2000-20103 Area Harvested to Paddy Rice, 1970-20104 Growth in Area Harvested to Paddy Rice, 1970-20105 Growth in Area Harvested to Paddy Rice, by Ecosystem/ Semester, 2000-20106 Comparative Area Harvested to Paddy Rice, Selected Asian Countries, 20097 Ratio of Population to Rice Area Harvested, Selected Asian Countries, 20098 Yield of Paddy Rice, 1970-20109 Growth in Yield of Paddy Rice, 1970-20101 0 Comparative Yield of Paddy Rice, Selected Asian Countries, 2000 and 20091 1 Comparative Growth in Yield of Paddy Rice, Selected Asian Countries, 2000-20091 2 Yield Gap Analysis1 3 Factors Affecting Yield1 4 Inputs in Paddy Rice Production: Seeding Rate, 20091 5 i i i

Inputs in Paddy Rice (Palay) Production: Fertilizer Rate, 20091 6 Costs of Paddy Rice Production, 20091 7 Returns to Paddy Rice Production, by Ecosystem, 20091 8 Farmgate Price of Paddy Rice, Selected Asian Countries, 20081 9 Breakdown of Rice Utilization, 20092 0 Rice Net Exports, Selected Southeast Asian Countries, 1960-20082 1 World Rice Export Supply and Import Demand, 1960-20082 2 Domestic and World Prices of Rice, 2000-20092 3 Imports of Non-traditional Rice-eating Countries, 1960-20082 4 Rationale for Self-Sufficiency in Rice2 5 Per Capita Rice Consumption, by Region, 1990/00 and 2008/092 6 Rice Import Dependency and Self-Sufficiency Ratios, 1990-20102 7 The Food Staples Sufficiency Program, 2011-20162 8 Projected Paddy Rice Requirement and Production, 2011-20163 0 References3 1 i v

A b b r e v i at i o n S a n d a c r o n y m s u s e d : M Million mt metric ton (1000 kg) ha hectare (10, 000 m 2 ) kg kilogram MRR Milling Recovery Rate BAS Bureau of Agricultural Statistics FAO Food and Agriculture Organization PH Philippines USDA United States Department of Agriculture BSP Bangko Sentral ng Pilipinas FSSP Food Staples Sufficiency Program NFA National Food Authority v

F o r e w o r d In 2009, the PhilRice Corporate Strategic Plan was crafted to serve as a guide in identifying priority areas in research and development (R&D) activities of the institute from 2010 to 2013. The Strategic Plan documents three national goals on which the institute can have an impact. These are attaining and sustaining rice self-sufficiency; reducing the incidence of poverty and malnutrition; and achieving competitiveness in agricultural science and technology. In line with the Plan, this primer on the Philippine rice industry was prepared to help researchers understand the trends and current status of the rice sector, the recipient of their research results. This may be useful in dovetailing rice research objectives with the current situation of the industry. This primer contains data and information on the country s rice production, area harvested, yield, farmgate prices, input-use, production costs and returns, rice utilization, rice imports and exports, and the Food Staples Sufficiency Program, 2011-2016. Comparisons of area harvested, populations, yields, prices, and net exports of selected Asian countries are also included. These data and information will be updated every three years. This publication is an initiative of the Impact Evaluation, Policy Research and Advocacy Program of the Philippine Rice Research Institute (PhilRice). It can serve as a reference material not only for researchers, but also for extension workers, farmers, policymakers, and other rice industry stakeholders. Eufemio T. Rasco Jr., PhD Executive Director v i

Pa d dy R i c e ( pa l ay ) P r o d u c t i o n, 1 9 7 0-2 0 1 0 Production of paddy rice in the Philippines (PH) peaked in 2008 at 16.82 M mt harvest, which is thrice as much as that obtained in 1970 (5.32 M mt). However, production consistently declined in succeeding years due to natural calamities. In 2010, the country harvested 15.77 M mt only, which is 6.2% less than the production level in 2008. This resulted from the drought brought by the El Niño phenomenon in the first semester and strong typhoons in the fourth quarter of 2010. Production in irrigated areas is growing. From 55% in 1970, the contribution of irrigated areas to the total production increased to 76% in 2010. On the other hand, the share of rainfed areas to total production declined from 45% in 1970 to only 24% in 2010 as a result of expanded irrigation coverage. 1

G r o w t h i n P a d d y R i c e P r o d u c t i o n, 1 9 7 0-2 0 1 0 Period/Ecosystem 1970-1984 Irrigated Non-irrigated All Ecosystems 1985-1999 Irrigated Non-irrigated All Ecosystems 2000-2010 Irrigated Non-irrigated All Ecosystems Growth in Production (in mt) January-June July-December January-December 92,570 19,437 112,008 99,776 (10,804) 88,972 149,027 38,828 187,855 109,023 13,074 122,097 87,594 (15,654) 71,940 165,089 74,987 240,076 201,594 32,511 234,105 187,370 (26,459) 160,911 314,115 113,815 427,930 Source of basic data: BAS From 2000 to 2010, the annual growth in paddy rice production in all ecosystems had far exceeded the annual growths observed during the 1970-1984 and 1985-1999 periods. In 2000-2010, production in all ecosystems grew by 427,930 mt, which is 83% and 166% higher than those in the 1970-1984 and 1985-1999 periods. This growth in paddy rice production is equivalent to 268,954 mt annual increase in milled rice production. Production in irrigated areas grew in all periods. It slowed down in nonirrigated areas in 1985-1999, chiefly due to shrinking area. 2

G r o w t h i n P a d d y R i c e P r o d u c t i o n, b y S e m e s t e r, 2 0 0 0-2 0 1 0 In 2000-2010, the growth of paddy rice production was higher in July-December than in the January-June period. Fifty-six percent of the overall growth in all ecosystems is produced in the second semester; 44% is produced in the first semester. The wet season generally occurs in the second semester. As supply of water is abundant, much more areas are planted during this season thereby increasing production. G r o w t h i n P a d d y R i c e P r o d u c t i o n, b y E c o s y s t e m, 2 0 0 0-2 0 1 0 From 2000 to 2010, 73% of the production increase came from irrigated areas; 27% came from non-irrigated areas. To maximize the opportunity to further increase production, the current AgriPinoy (Agrikulturang Pilipino) Rice Program framework aims to develop new and improve existing irrigation facilities. 3

A r e a H a r v e s t e d t o P a d d y R i c e, 1 9 7 0-2 0 1 0 Source of basic data: FAO Area harvested in all ecosystems follows the trend in non-irrigated areas from 1970 to 1999 but reflects the upward trend in irrigated areas in later years. Total area harvested depends on area of cultivated land and on cropping intensity. Investments in irrigation facilities during 2000-2010 have intensified cropping system, thus expanding the effective area for rice production. So far, intensified cropping compensates for the reduction in physical area due to conversion of land for other agriculture and non-agriculture uses. From 2003 to 2007, an average of 9000 ha or 0.36% of total rice area harvested were converted annually (Francisco and Mataia 2009). Land conversion has to be managed very well to avoid negating irrigation investments and prevent further reduction in rice area. 4

G r o w t h i n A r e a H a r v e s t e d t o P a d d y R i c e, 1 9 7 0-2 0 1 0 Period/Ecosystem 1970-1984 Irrigated Non-irrigated All Ecosystems 1985-1999 Irrigated Non-irrigated All Ecosystems 2000-2010 Irrigated Non-irrigated All Ecosystems January- June 13,666 1,642 15,308 26,089 (7,415) 18,674 15,337 3,008 18,345 Growth in Area Harvested (in ha) July- December 11,828 (31,505) (19,677) 24,402 (8,928) 15,474 23,318 6,110 29,428 January- December 25,494 (29,863) (4,368) 50,491 (16,343) 34,148 38,655 9,118 47,773 Source of basic data: BAS From 1985 to 2010, the yearly growth in area harvested to paddy rice in all ecosystems and seasons was positive. The highest growth was recorded in the 2000-2010 period. In the1970-1984 and 1985-1999 periods, non-irrigated ecosystem shrank, affecting the growth of area harvested in all ecosystems. In 2000-2010, investments in irrigation systems have resulted in improved growth of area harvested. This growth offset the increasing rate of rice land conversion in that period. 5

G r o w t h I N A r e a H a r v e s t e d t o p a d d y r i c e, b y e c o s y s t e m, 2 0 0 0-2 0 1 0 Overall, 81% of the increase in area harvested from 2000-2010 was due to expansion of irrigated areas while 19% was due to expansion of non-irrigated ecosystems. G r o w t h i n A r e a H a r v e s t e d b y s e m e s t e r, 2 0 0 0-2 0 1 0 Seasonal growth in area harvested shows that in the 2000-2010 period, 62% of increase in total area harvested was gained in July-December (wet season) while 38% was gained in January - June. 6

C o m p a r at i v e A r e a H a r v e s t e d t o P a d d y R i c e, S e l e c t e d A s i a n C o u n t r i e s, 2 0 0 9 Source of basic data: FAO The area harvested to rice in the Philippines is very small compared to major rice-producing countries in Asia. In 2009, the Philippines harvested only 4.53 M ha, which is 58.7% and 39.1% lower than in Thailand and Vietnam, respectively. The Philippines is an agricultural country that has limited land resource to produce its rice requirement. This leads to insufficient domestic production relative to utilization, necessitating rice importation. 7

R at i o o f P o p u l at i o n t o R i c e A r e a H a r v e s t e d, S e l e c t e d A s i a n C o u n t r i e s, 2 0 0 9 Source of basic data: FAO Supplying Filipinos with enough rice pressures hard the domestic rice industry especially when the population is rising at an average rate of at least 2% per annum. The Philippines feeds more people per unit area compared to Thailand and Vietnam, which are rice-exporting countries. In 2009, the country feeds 20 persons per hectare of rice area harvested. In contrast, Thailand and Vietnam only feed 6 and 12 persons, respectively. These countries are able to export their produce because of their relatively lower domestic demand for rice. 8

Y i e l d o f P a d d y R i c e, 1 9 7 0-2 0 1 0 Despite the limited land resource, paddy rice yield in the Philippines has more than doubled since 1970. Yield peaked in 2007 at 3.80 mt/ha in all ecosystems but declined since then because of natural calamities that hit the country. In 2010, yield in all ecosystems slightly recovered by 0.83% from its slump in 2009 (3.59) as it averaged 3.62 mt/ha. Yields in irrigated and non-irrigated areas were 3.99 and 2.81 mt/ha. 9

G r o w t h i n Y i e l d o f P a d d y R i c e, 1 9 7 0-2 0 1 0 Period/Ecosystem 1970-1984 Irrigated Non-irrigated All Ecosystems 1985-1999 Irrigated Non-irrigated All Ecosystems 2000-2010 Irrigated Non-irrigated All Ecosystems Source of basic data: BAS January- June 88 33 70 14 3 24 67 67 69 Growth in Yield (kg/ha) July- December 90 51 76 8 4 14 50 65 58 January- December 89 46 74 11 4 18 59 66 62 Since 1970, average annual growth in yield in all ecosystems had been positive, which pushed up total paddy rice production. Highest growth in yield was observed in the 1970-1984 period courtesy of the Green Revolution interventions. However, yield growth reduced to 18.1 kg/ha in the 1985-1999 period. Paddy rice yield recovered in 2000-2010 with an annual increment of 62.5 kg/ha. From 1970 to 1999, growth in yield in irrigated areas was higher than in non-irrigated areas. This was reversed in the 2000-2010 period when yield growth in non-irrigated areas (65.7 kg/ha) overtook that in irrigated areas (58.7 kg/ha). 1 0

C o m p a r at i v e Y i e l d o f p a d d y r i c e, S e l e c t e d A s i a n C o u n t r i e s, 2 0 0 0 a n d 2 0 0 9 Source of basic data: FAO Thailand and India have bigger rice areas harvested than the Philippines but the latter is more productive per unit area compared to the two countries. In 2009, the Philippines had an average yield of 3.59 mt/ha while Thailand and India had only 2.87 and 2.98 mt/ha, respectively. However, the Philippines still needs to catch up with other nations like Indonesia and Vietnam, which are also tropical countries. 1 1

C o m p a r at i v e G r o w t h i n Y i e l d o f p a d d y r i c e, S e l e c t e d A s i a n C o u n t r i e s, 2 0 0 0-2 0 0 9 Source of basic data: FAO In the period 2000-2009, the Philippines had higher growth rate in yield (2.19%), compared to exporting countries such as Thailand, India, and China. If the Philippines did not experience natural calamities in 2009, this growth could have been better. 1 2

Y I E L D G A P A N A LY S I S Source: Sebastian, L.S., F.H. Bordey, and V.L.E.B. Alpuerto. 2006. Research and development. In Securing Rice, Reducing Poverty, A.M. Balisacan and L.S. Sebastian (eds.) Science City of Muñoz: Philippine Rice Research Institute. The national average yield in all ecosystems, which is 3-4 mt/ha, is not even half of the scientifically attainable yield if only Good Seeds* of modern inbred rice varieties are used as planting materials. And yet, yields of 6-7 mt/ha were attained in on-farm demonstration trials that used Good Seeds but with best crop management practices. Thus, the country s total production of paddy rice can be increased further if the national average yield is raised through sustained use of best crop management practices. * Note: Good Seeds are produced from varieties not yet approved by the National Seed Industry Council but meet the standards prescribed by the certifying agency. Additionally, any class of certified seeds that does not conform to the Council s standards may qualify as Good Seeds. 1 3

F a c t o r s a f f e c t i n g y i e l d FACTORS R&D Seeds (biotechnology, hybrid rice, certified seed nutrition) Integrated Crop Management Mechanization Infrastructure Irrigation Farm-to-market roads Transportation Postharvest Extension Environmental Factors CONTRIBUTION 25% 10% 10% 5% 40% 25% 5% 5% 5% 15% 20% Source: Balisacan, AM and LS Sebastian. 2006. Challenges and Policy Directions: Overview In Securing Rice, Reducing Poverty, AM Balisacan and LS Sebastian (eds.). Science City of Munoz: Philippine Rice Research Institute. The factors that can collectively and significantly improve average yield at the national level are infrastructure, research and development (R&D), extension, and environmental factors. Irrigation has the biggest impact contributing 25% on yield improvement; R&D, through better seed quality, crop management practices, and mechanization contribute 25%. Among the four major factors, extension service itself has the least estimated influence on yield (15%). However, without it, the 25% contribution of R&D cannot be realized. 1 4

I n p u t s i n P a d d y R i c e P r o d u c t i o n : S e e d i n g R at e, 2 0 0 9 Seed Class Hybrid Inbred High-quality seeds a Low-quality seeds Good Seeds Farmer Seeds Native Seeds Seeding Rate (kg/ha) Direct-seeded Rice Transplanted Rice Average - 22 22 82 108 105 115 104 56 75 70 80 74 69 91 88 97 89 - no data a - includes Certified, Registered, and Foundation seeds. Source of basic data: PhilRice-BAS compiled data 91 kg/ha of low-quality seeds cost P1,365/ha. 40 kg of Certified Seeds cost P1,200/ha In 2009, the average seeding rate using high-quality inbred seeds was 69 kg/ha. Although lower than in 2008 (88 kg/ha), the 2009 seeding rate is still higher than the recommended rate of only 40 kg/ha. Most farmers sow extra seeds to replace those that may be damaged by pests during the seedling and vegetative stages. Average seeding rate is even higher for low-quality seeds (91 kg/ha). Higher rate is to compensate for low germination and other possible losses. In terms of cost, using low-quality seeds can entail higher cost per hectare (P1,365/ha at P15/kg) than high-quality seeds (P1,200/ha at P30/kg). Thus, farmers can save on seed cost if they would follow the 40-kg certified seeds recommendation. 1 5

Fertilizer Grade Fertilizer (in 50-kg bags/ha) Urea Ammosul Ammophos Complete Component Nutrients (in kg/ha) Nitrogen Phosphorus Potassium I n p u t s i n P a d d y R i c e P r o d u c t i o n : F e r t i l i z e r R at e, 2 0 0 9 Irrigated Fertilizer Rate Rainfed Jan-Jun Jul-Dec Jan-Jun Jul-Dec 2.34 0.43 0.66 1.49 74 17 10 2.30 0.48 0.57 1.51 73 16 11 1.21 0.39 0.30 0.66 39 8 5 1.71 0.49 0.50 1.18 Source of basic data: BAS Nutrient conversion used: 46-0-0 for urea, 21-0-0 for ammosul, 16-20-0 for ammophos, and 14-14-14 for complete. In both semesters, farmers in irrigated areas apply more fertilizers than those in rainfed areas. Fertilizer rate in irrigated areas during the dry season (Jan-Jun) is not significantly higher than in the wet season (Jul-Dec) despite greater economic benefits of applying more fertilizers in the DS. Increasing fertilizer rate during the DS can further increase yield and production. This should be given attention in extension and information dissemination. Rainfed farmers apply more fertilizers in the WS when water is more available. Although it is theoretically more efficient to apply more fertilizers during the DS, water constraint could easily result in under-application of fertilizers. The low fertilizer application of rainfed farmers during the DS could be one of their risk-mitigating measures. Water source must be reliable so rainfed farmers can optimize fertilizer use. 57 13 8 1 6

C o s t s o f P a d d y R i c e P r o d u c t i o n, 2 0 0 9 Variable Cost Seeds Fertilizers and Soil Ameliorants Pesticides Rental of Machines, Tools, and Animals Including Repairs and Depreciation Irrigation Interest Payment on Crop Loan Labor Others (fuel & oil, food, transpo, etc.) Amount (Pesos/ha) 1,903 4,725 1,069 1,830 678 2,158 11,522 1,691 % of Total Variable Cost Total variable cost (P/ha) 25,576 100 Source of basic data: BAS 7 18 4 7 3 8 45 7 In 2009, labor accounted for the largest share (45%) in the total variable cost of rice production. This indicates that rice production can be more competitive if we reduce labor cost. 1 7

R e t u r n s t o P a d d y R i c e P r o d u c t i o n, b y E c o s y s t e m, 2 0 0 9 Items Yield (kg/ha) Farmgate price (P/kg) Gross returns (P/ha) All Ecosystems 3,587 15 52,478 Irrigated 3,952 15 57,818 Non- Irrigated 2,833 15 41,447 Total variable cost per hectare (P/ha) Returns to land (P/ha) Returns to own labor (P/ha) Returns above variable cost (P/ha) 25,576 6,694 20,208 26,902 27,934 7,370 22,514 29,884 20,130 5,139 16,178 21,317 Variable cost per kg of yield (P/kg) Returns to land per kg of yield (P/kg) Returns to own labor per kg of yield (P/kg) 7 2 6 7 2 6 7 2 6 Source of basic data: BAS In 2009, average net returns above variable costs were positive. Irrigated farmers obtained better returns than non-irrigated farmers. At the farmgate price of P15.00/kg, if a farmer is the landowner he would receive a net return of P8.00 per kg of paddy rice produced. Six pesos of which is returns to own labor and two pesos is the returns to land. If the farmer is a land renter/lessee, the return would be slightly lower at P6.00/kg. Since Filipino rice farmers cultivate only a hectare of land on individual average, income from rice farming is still not enough to sustain a household even though the return per kilogram of paddy rice is high. 1 8

F a r m g at e P r i c e o f P a d d y r i c e, S e l e c t e d A s i a n C o u n t r i e s, 2 0 0 8 Source of basic data: FAO The farmgate price of paddy rice in the Philippines is higher than those in China, Thailand, and Indonesia. In 2008, Filipino farmers sold their produce at US$319/mt while Thai, Indonesian, and Chinese farmers sold theirs at US$267/ mt, US$280/mt, and US$278/mt, respectively. Nevertheless, the farmgate price in PH is lower than in India (US$386/mt). 1 9

B r e a k d o w n o f R i c e U t i l i z at i o n, 2 0 0 9 Source of basic data: BAS Eighty-nine percent of all rice is used as food. Seeds account for 2% of total utilization, processed rice products for 3%, and feeds and wastes for 6%. MRR is one of the factors that affect the amount of milled rice available for utilization; based on the study of Vallesteros (2010), MRR is only 62.85%. This means that it will take almost 160 kg of paddy rice to produce 100 kg of milled rice. If MRR is improved to 65%, only 154 kg of paddy will produce 100 kg of milled rice. 2 0

R i c e N e t E x p o r t s, S e l e c t e d S o u t h E a s t A s i a n C o u n t r i e s, 1 9 6 0-2 0 0 8 Source of basic data: FAO Many Filipinos wonder why they import rice when they even host the International Rice Research Institute, which is the source of modern rice technology for many exporting countries in Southeast Asia like Thailand. Trends show that PH had been importing rice and Thailand had been exporting even before the advent of modern rice technology. The ability to export rice does not rest on technology alone. Dawe (2006) says exporting countries (Thailand, Vietnam, Cambodia, Myanmar) occupy river deltas with large areas suitable for rice production. On the contrary, importing countries have less arable land per person and more varied landscape, which favors alternative crops such as corn, palm oil, or coconut. Indonesia and the Philippines are islands, while Malaysia is part island and part narrow peninsula. Thus, natural endowments of land and water are strong forces that determine the ability of a nation to export rice. 2 1

W o r l d R i c e E x p o r t S u p p ly a n d I m p o r t D e m a n d, 1 9 6 0-2 0 0 8 Source of basic data: USDA The gap between world rice export and import has widened since 2000. Yet, net world supply is still very thin, indicating vulnerability of world rice prices to supply and demand shocks. The recent Australian drought and the shift in land use toward energy crops in the USA are examples of supply shocks. The persistent shift in preference of African nations toward rice consumption is an example of a demand shock. 2 2

D o m e s t i c a n d W o r l d P r i c e s o f R i c e, 2 0 0 0-2 0 0 9 Source of basic data: PhilRice-BAS, FAO, USDA, BSP Since 2000, the world price of rice had been generally stable and lower than the domestic price. All this changed in 2008 when the world price sharply increased during the first semester creating a crisis. World price receded toward the end of 2008 but did not return to pre-crisis level. Dawe and Slayton (2010) said market fundamentals were not the cause of the 2008 rice crisis. External factors such as rising oil prices since 2004, weak US dollar, biofuel mandates and tariffs that contributed to rising maize and soybean prices, and weather-induced decline in world wheat production altogether set the stage for the crisis. Policies of exporting and importing countries that lead to market uncertainty and panic caused the surge in the world price of rice. India and Vietnam decided to ban their exports. Thailand did not restrict their exports but their policy statements on doing so contributed to uncertainty in the world market. On the other hand, the Philippines put out larger tenders and agreed to buy at high prices, which fueled further speculations. Malaysia and Nigeria joined PH in stockpiling. All this shows the vulnerability of the world rice market to price shocks. 2 3

I m p o r t s o f N o n - t r a d i t i o n a l R i c e - E at i n g C o u n t r i e s, 1 9 6 0-2 0 0 8 Source of basic data: USDA *Middle East refers to Iran, Iraq, and Saudi Arabia Changes in world demand also affect the volume of rice available in the international market. An example of this is the increasing demand for rice of non-traditional rice-eating countries such as those in Africa, Middle East, South America, and the USA. The demand of these countries competes with traditional rice-eating countries in Asia. Except for high-income China and Japan, rice consumption in Asian countries have not declined significantly. 2 4

R AT I O N A L E F O R S E L F - S U F F I C I E N C Y I N R I C E T h i n W o r l d S u p p ly E X P O R T B A N S ^ ^ ^ r i c e s e l f - s u f f i c i e n c y I n c r e a s i n g d e m a n d f r o m n o n t r a d i t i o n a l r i c e - e at i n g c o u n t r i e s Dependence on imports holds the country vulnerable to supply and demand shocks that can cause significant changes in the world price of rice. With the occurrence of thin world stocks, export bans during times of volatility in the world market, and the increasing demand from non-traditional rice-eating countries, growing reliance on local rice production would help shield the country from the negative effects of the fluctuations in the world price of rice. Hence, the quest for self-sufficiency in rice. 2 5

P e r C a p i ta R i c e C o n s u m p t i o n, B y R e g i o n, 1 9 9 0 / 0 0 a n d 2 0 0 8 / 0 9. Region Per Capita Rice Consumption (kg) Percent Change 1999/00 2008/09 Philippines NCR CAR Ilocos Region Cagayan Valley Central Luzon CALABARZON MIMAROPA Bicol Region Western Visayas Central Visayas Eastern Visayas Zamboanga Peninsula Northern Mindanao Davao Region SOCCSKSARGEN Caraga ARMM 106 90 121 118 116 111 108 108 111 122 67 113 90 91 108 103 114 122 119 101 132 125 122 123 113 136 124 134 95 127 109 116 113 137 128 145 13 12 9 6 6 11 4 26 12 10 41 13 21 28 5 32 13 18 Per capita rice consumption (PCRC) in the Philippines has risen by 13% from 106 kg/year in 1999/2000 to 119 kg/year. PCRC rose in all regions, with Central Visayas increasing the largest (41%) and CALABARZON region the least (4%). Central Visayas has a large population that are traditionally corn-eaters. Consumer preference has shifted from white corn to rice. The increasing urbanization in CALABARZON can be the cause of its tempered increase in PCRC. In 2008/2010, Central Visayas region has still the least PCRC at 95 kg/year while ARMM has the highest at 141 kg/year. 2 6

R I C E I m p o r t D e p e n d e n c y a n d s u f f i c i e n c y R at i o s, 1 9 9 0-2 0 1 0 Source of basic data: BAS Despite our relatively high production, the Philippines contends with a declining level of self-sufficiency and increasing dependence on imports. From 91% in 1990, our level of self-sufficiency decreased to 80% in 2010. This is because of the fast-increasing population and rising per capita rice consumption. 2 7

T h e f o o d s ta p l e s s u f f i c i e n c y p r o g r a m ( 2 0 1 1-2 0 1 6 ) The Department of Agriculture and its bureaus and attached agencies working on the development of the rice sector crafted the Food Staples Sufficiency Program (2011-2016). The following outlines its basic strategies to achieve selfsufficiency in rice: 1. P r i o r i t i z e i n v e s t m e n t s t h at c a n i n c r e a s e a n d s u s ta i n p r o d u c t i o n g r o w t h A. Production interventions. Expansion of area harvested and improvement of yield or productivity per unit area can increase paddy rice production. The FSSP for 2011-2016 outlines the following basic interventions that have long-term positive effects on productivity: a. Development and maintenance of irrigation systems b. Increase farmers access to high-quality seeds c. Research, development, and promotion of appropriate technologies d. Extension and farmers education B. Creation of enabling mechanisms. These are support services that aim to engender a favorable environment that will entice farmers to increase investments in rice farming. These services are expected to provide economic incentives that can stimulate farmers interest to further raise their production. a. Reform the National Food Authority (NFA) increase its domestic palay procurement; phased increase of selling prices of NFA rice; replacement of untargeted consumer subsidy by conditional cash transfer; and focused role on buffer stocking and price support to farmers. 2 8

b. Increase credit guarantee fund this will encourage private banks to cater to credit needs of farmers, thus, leading to better credit access to formal lenders. c. Increase number of farmers covered by crop insurance this will ease production risks like typhoons that burden the farmers. 2. I n t e n s i f y f a r m m e c h a n i z at i o n a n d r e d u c e p o s t h a r v e s t l o s s e s A. Farm mechanization. Efficiency and timeliness of farm operations can be attained if farm mechanization is intensified. This will be helpful in times of labor shortage and in areas where labor cost is expensive. B. Modernization of postharvest facilities. Current postharvest processes such as drying and milling can lead to palay losses estimated at 16.47% of total production. Reducing postharvest losses is one way of increasing available rice for consumption. 3. M a n a g e m e n t o f C o n s u m p t i o n The following strategies to attain an ideal demand level for rice can also contribute to the attainment of self-sufficiency in rice: A. Promoting the consumption of brown rice. Since brown rice is unpolished, its production can lead to higher milling recovery as rice bran is retained on the grains, making it even more nutritious. B. Reduction of rice wastage. Families are encouraged to cook and eat just the right amount of rice every meal, thus, reducing table wastage. This can further increase the availability of rice for consumption. C. Diversification of staples. Increasing the production and market availability of alternative staples (i.e., white corn, kamote, cassava, and banana) can make the prices of these substitutes affordable to consumers. This will trigger a shift of consumption from rice to other staple foods, hence, reducing the demand for rice. 2 9

R e f e r e n c e s : Balisacan, A.M. and L.S. Sebastian [2006] Challenges and Policy Directions: Overview, in A.M. Balisacan and L.S. Sebastian, eds., Securing Rice, Reducing Poverty: Challenges and Policy Directions. Los Banos, Laguna: Southeast Asian Regional Center for Graduate Study and Research in Agriculture. pp. 1-19. Bangko Sentral ng Pilipinas (BSP) [n.d.] Monetary, External, and Financial Statistics, http://www.bsp.gov.ph/statistics/statistics.asp Accessed August 2010. Bureau of Agricultural Statistics (BAS) [n.d.] Database, http://countrystat.bas. gov.ph/index.asp, Accessed August 2010. Dawe, D. [2006] The Philippines Imports Rice Because it is an Island Nation, in D. Dawe, P.F. Moya, and C.B. Casiwan, eds., Why Does the Philippines Import Rice? Manila: International Rice Research Institute. pp. 3-7. Dawe, D. and T. Slayton [2010] The World Rice Market Crisis of 2007-2008, in D. Dawe, ed., The Rice Crisis. London and Washington DC: The Food and Agriculture Organization and Earthscan, pp. 16-28. Food Staples Self-Sufficiency Program, 2011-2016. Department of Agriculture 2011. Francisco, S.R. and A.B. Mataia [2009] Policy Advocacy, in, The Philippine Rice R&D Highlights 2008. Munoz City, Nueva Ecija: Philippine Rice Research Institute. pp. 319-321. Sebastian, L.S., F.H. Bordey, and V.L.E.B. Arpuerto [2006] Research and Development, in A.M. Balisacan and L.S. Sebastian, eds., Securing Rice, Reducing Poverty: Challenges and Policy Directions. Los Banos, Laguna: Southeast Asian Regional Center for Graduate Study and Research in Agriculture, pp. 39-69. United States Department of Agriculture (USDA) [n.d.] Agriculture Data and Statistics, http://www.usda.gov/wps/portal/usda/usdahome, Accessed August 2010. Vallesteros, R., Jr. [2010] The New National Rice Milling Recovery Rate: Its Effect on the Level of Rice Per Capita Consumption in the Philippines, CY 2000-2008. Paper presented at the 23rd National Rice R&D Conference of the Philippines held in IRRI, Los Baños, Laguna. 4 March 2010. 3 0

C r e d i t s : Subject Matter Specialists Flordeliza H. Bordey, Ph.D. Aileen C. Castañeda Managing editor/layout artist Alfred Caballero Editorial Adviser Eufemio T. Rasco Jr., Ph.D. Consulting Editor Constante T. Briones 3 1

n o t e s 3 2

PHILIPPINE RICE RESEARCH INSTITUTE RICE SCIENCE FOR DEVELOPMENT We are a chartered government corporate entity under the Department of Agriculture. We were created through Executive Order 1061 on 5 November 1985 (as amended) to help develop high-yielding, cost-reducing, and environment-friendly technologies so farmers can produce enough rice for all Filipinos. We accomplish this mission through research and development work in our central and seven branch stations, coordinating with a network that comprises 57 agencies and 70 seed centers strategically located nationwide. To help farmers achieve holistic development, we will pursue the following goals in 20102020: attaining and sustaining rice self-sufficiency; reducing poverty and malnutrition; and achieving competitiveness through agricultural science and technology. We have the following certifications: ISO 9001:2008 (Quality Management), ISO 14001:2004 (Environmental Management), and OHSAS 18001:2007 (Occupational Health and Safety Assessment Series). You may visit our websites: www.philrice.gov.ph www.pinoyrkb.com or text: PhilRice Text Center: 0920-911-1398 PhilRice Stations: Central Experiment Station Maligaya, Science City of Muñoz, 3119 Nueva Ecija Trunklines: (44)4560258; -0277, -0285 0920-970-2629 (only for connection to local#) Email: prri@email.philrice.gov. ph PhilRice Agusan Basilisa, RTRomualdez, 8611 Agusan del Norte Tel: (85) 818-4477; 343-0778 Tel/ Fax: 343-0768 Email: agusan@email.philrice.gov.ph PhilRice Batac MMSU Campus, Batac City, 2906 Ilocos Norte Tel/Fax: (77) 792-4702;670-1867 Email: batac@email.philrice.gov.ph PhilRice Bicol Batang, Ligao City, 4504 Albay Cell:0908-884-0724 PhilRice Isabela Malasin, San Mateo, 3318 Isabela Tel: (78) 664-2954 Tel/Fax: 664-2953 Email: san_mateo@email.philrice.gov.ph PhilRice Los Baños UPLB Campus, Los Baños, 4030 Laguna Tel: (49) 536-8620 501-1917 Email: los_banos@email. philrice.gov.ph PhilRice Midsayap Bual Norte, Midsayap, 9410 North Cotabato Tel: (64) 229-8178 Tel/Fax: 229-7242 Email: midsayap@email.philrice.gov.ph PhilRice Negros Cansilayan, Murcia, 6129 Negros Occidental Cell: 0928-506-0515 Email: negros@email.philrice.gov.ph PhilRice Field Office CMU Campus, Maramag, 8714 Bukidnon Tel/Fax: (88) 222-5744