By Vincent Mariel P. Galang, October 23 2019; Business World

Image Credit to Philippine Star

THE DEPARTMENT of Agriculture (DA) has maintained its 2019 growth target for the agriculture sector at two percent, as it launches operations using the Rice Competitiveness Enhancement Fund (RCEF) seven months after Republic Act No. 11203, which liberalized rice importation, took effect.

“We will maintain that target. Itong pagkaumpisa nag-implementasyon ng (The start of the implementation of) RCEF will be a big factor, reckoning from August 2019 to end of July 2020,” Agriculture Secretary William D. Dar said in a briefing in Quezon City on Tuesday.

Ako positive pa din ang aking pananaw (I remain optimistic that) rice will still be the driving factor kasi crops sector naman ang pinakamalaki (because the crops sector is the biggest driver of agriculture sector growth),” he said after the briefing, adding that his projection accounts for other factors like impact of African Swine Fever (ASF).

The crop sector contributes half the value of total agriculture production, with rice alone contibuting nearly a fifth.

Value of agriculture production slipped by 0.24% year-on-year last semester after a 1.27% contraction in the second quarter and a 0.64% increment in January-March.

The 2017-2022 Philippine Development Plan has a 2.5-3.5% target range for output growth of the sector, which accounts for about a fourth of the country’s jobs but just a tenth of national output due to low productivity.

The Philippine Statistics Authority is scheduled to report third-quarter farm data on Nov. 6, and it remains to be seen how the sector fared in July-September, compared to the 0.87% year-ago contraction.

In August, Mr. Dar first announced his two percent goal for this year while expecting upside to as much as four percent within three years, with a focus on achieving food security through higher output relative to population growth, while also increasing the income of farmers and fisherfolk.

Farm output grew 0.56% in 2018, slower than 2017’s 3.96% expansion, the department’s goal of 2.5% and a two percent target set by economic managers.

Mr. Dar said that RCEF interventions are in time for the next planting season.

RA 11203, which replaced quantitative restrictions for rice with regular tariffs, provided for the establishment of the RCEF with the goal of improving yields and farmers’ incomes, as well as reducing the cost of production through mechanization, high-yeld seed, training and increased availability of credit.

“It’s never late because ngayon lang yung main production time for this season. Talagang ito yung panahon (This is the right time to address production issues). The implementation of the RCEF is being accelerated because this is the right time. This is the time of the year that such interventions must start,” Mr. Dar said.

“For the next six years, proper implementation of the Rice Competitiveness Enhancement Fund will make the rice farmers more productive, more competitive, and more prosperous.”

RCEF, which will be funded by collections of rice import tariffs estimated at P10 billion a year for six years, has for its first year of implementation set aside P5 billion for mechanization, P3 billion for distribution of inbred seed and P1 billion each for credit and extension services.

Target areas are 947 municipalities.

The Agriculture chief noted that of the total amount, 32% has been obligated.

“We hope to elevate the yield average to five to six metric tons over the years… Properly done, all these four components (mechanization, seed, training and credit) will reduce the cost of production from P12 to P6, so that pwede kang makipag-compete sa… Vietnam and Thailand (to the point where the industry becomes competitive with Vietnam and Thailand),” Mr. Dar said. — Vincent Mariel P. Galang