FARMERS said the P15,000 subsidy for rice dealers being squeezed by the price controls on the grain is expected to cost the government P2 billion.
“Mapapagastos pa ang gobyerno ng P2 billion para ayudahan ang mga retailer (The government now has to spend P2 billion to aid the retailers),” Raul Q. Montemayor, national manager for the Federation of Free Farmers, said in a Viber message.
Farmers have expressed fears that traders will low-ball them on purchases of palay, or unmilled rice, to compensate for the margin squeeze resulting from the price controls.
Executive Order No. 39 imposed a temporary price ceiling of P41 per kilogram for regular-milled rice and P45 per kilogram for well-milled rice.
The Department of Agriculture (DA) has received complaints from farmers that traders might collude to pay a “uniform lower price” to make up for the price controls.
The effect has been to lower the price farmers receive for their harvest, leading to calls for a farmer subsidy as well to compensate them for lost revenue.
Samahang Industriya ng Agrikultura Executive Director Jayson H. Cainglet described the retailer subsidy as assistance in acquiring more expensive inventory.
“’Yung ayuda ay para maitawid lang ’yung pagbili nila ng mas mahal na bigas mula sa mga wholesalers or millers (The subsidy is just to cover their purchase of more expensive rice from wholesalers or millers),” he added.
He estimated that the subsidy was sufficient to procure 7,000 kilograms (kg) of rice, equivalent to 280 sacks of rice at 25 kilos of rice.
He said the inventory of a typical retailer turns over every seven to 10 days.
He said that average rice stocks from retailers usually last for seven to 10 days.
The Department of Social Welfare and Development (DSWD) started handing out the P15,000 cash aid to rice retailers in Quezon City, San Juan, and Caloocan.
About 232 rice retailers received the subsidy, with 48 were from Quezon City, 136 from Caloocan City, and 48 from San Juan.
The Presidential Communications Office said in a statement on Sunday, that the Departments of Agriculture and Trade and Industry (DTI) have identified another 337 beneficiaries who are set to receive cash aid on Sept. 11.
Among these are 15 rice retailers in Pateros, 161 in Navotas, 129 in Parañaque, and 32 in Zamboanga del Sur.
“As the government’s cash assistance continues, the DSWD and the DTI will meet on Monday to discuss the list of beneficiaries for the rest of the National Capital Region (NCR) and those in the provinces, among other measures,” it said. — Adrian H. Halili