filbet EDITORIAL - Again, price manipulation
With rice retail prices refusing to go down despite tariff cuts and the resulting flood of imports, the nation is again hearing officials talking about cartels and price manipulation. Whether the talk will lead to anyone being indicted for price manipulation or cartel-like operations remains to be seen.
Since last year, rice prices have been going up, due mostly to El Niño and India’s consequent ban on its export of non-basmati rice as well as geopolitical tensions that have disrupted global supply chains. The high prices have been fueling food inflation in the Philippines, which in turn has accounted for the biggest component of headline inflation.
All surveys by reputable pollsters have consistently shown the administration getting the weakest points in taming inflation. This is despite the provision of rice at heavily subsidized prices along with other commodities in the Kadiwa outlets.
So the government decided to bring in more rice imports. In June this year, President Marcos signed Executive Order No. 62, cutting tariffs on certain commodities particularly rice from 35 percent to just 15 percent. The move, recommended by the National Economic and Development Authority, was made despite concerns raised by local rice producers about the impact of the flooding of rice imports. Government data showed that the tariff cut has resulted in P13.3 billion in forgone revenues so far. To the dismay of government officials, however, rice retail prices still range from P55 to P60 per kilo.
The Department of Agriculture has reportedly blacklisted 10 companies believed to be involved in unfair or illegal trading in agricultural commodities. Meanwhile, the quinta committee of the House of Representatives wants the National Bureau of Investigation to identify entities along the supply chain who might be responsible for manipulating rice prices.
Some lawmakers think that with the tariff cuts, rice retail prices should be at P35 a kilo. Even at Kadiwa outlets, however, the lowest price that the government can offer is P40 per kilo under the Rice-for-All program, with the aspiration that it can still be brought down to P36 to P38 by January. Agriculture officials have said the tariff cuts are probably taking time to make an impact because traders are still unloading their stocks that were bought before EO 62 took effect.
Lawmakersfilbet, however, suspect price manipulation, and want the NBI to find out where this is happening along the supply chain. This will involve drawing the line between price gouging and turning a profit from legitimate business practices. The nation has heard such accusations before, and is waiting for the results of the latest probe.