reaction paper.

Mischelle B. Cabajes December 30, 2010
BSC-MA 3D MWF 12:25-1:25

RICE SHORTAGE

MANILA, Philippines – For the world’s biggest rice importer, will 2010 be another 2008, a year plagued with skyrocketing rice prices amid squeezed supply?Past experiences have led the Philippine government to ensure that retail cost of this staple is affordable and supply assured. These issues determined the political careers of previous national leaders.While 2009 was supposed to be a year when these issues were laid to rest, events beyond any government’s control distressed laid out plans. Storms battered the country, submerging key agricultural areas. Rice paddies that were supposed to provide stocks for the first quarter of 2010 became useless.The agriculture department has estimated that the Philippines lost some 1.3 million metric tons of paddy rice (or 850,000 metric tons of milled rice) as recent typhoons damaged the country's key rice-producing areas.At the tail-end of 2009, the Philippines rushed to the world market to plug its supply gap at home. As expected, the trading price for rice in the world market also climbed.For 2010, research groups are looking at a global rice shortage, as well as higher prices for the crop.
Rice deficit
In a report, London-based research company Business Monitor International (BMI) is expecting a global rice deficit of 6.7 million tons in 2010 from its previously anticipated balance."The world's largest rice importer [ Philippines ] has recently begun to ramp up imports. We now project a global rice deficit of 6.7 million tons in 2010," BMI said in the Asia edition of its Global Macro Monitor.HSBC Global Research, for its part, noted that rice prices have risen more than 25% in recent months as higher demand from the Philippines and India have caused fears of a supply shortage next year.Aside from the Philippines and India , other Asian countries said to be at risk of higher rice prices are Sri Lanka , Indonesia , Thailand , and Vietnam ."The Philippines , easily one of the largest global rice importers, had severe production shortages due to typhoon damage and has started to place record tenders to prevent a squeeze next year," the group said in its recent report.So far, the government has accessed future rice imports that are less than it had targeted.The National Food Authority (NFA) recently announced that it will buy 586,554.37 tons of rice from its third and last tender on December 15, slightly less than the 600,000 it sought to purchase.Last week, the government was only able to buy 474,272.70 metric tons of imported rice out of the 600,000 metric tons it bidded out in its December 8 tender due to higher rice prices in the international market.On top of these is the government’s purchase of 509,950 metric tons of rice last December 1, lower than the originally planned batch of 600,000 metric tons.So far, the Philippines has bought 1.23 million metric tons of rice, with the government planning to buy as much as 400,000 metric tons of rice through a reorder scheme provided by the procurement law.

My reaction about this issue is that the government will have an action in that rice shortage in our country because many people suffered because they are hungry. The Philippines had gone from being a major exporter of rice in the 1960’s to the world’s largest importer today. This dependence makes the country vulnerable to price and supply fluctuations in the world market. Lack of focus on food security by successive Philippine governments contributed to this dependence. We need to increase agricultural output to re-join the ranks of the regions major rice producers to which we once belonged. Our future as a truly free and independent society depends on it. The crisis in our country may affect all people belong in this society, we must configurative the this that we need in our country. This things may help us to provide in such things like Philippines is an island country, geographically its hard to consolidate the total rice production in our country to really see if we have excess or less supply of rice. We still have Visayas and Mindanao as rice production area. There is agricultural subsidy but there is no transparency in the distribution of the money being used to give farmers farm inputs. (There is a conflict of interest obviously). higher population means higher urbanization rate thus possibility of a rice farm to be sold at a high price. You cannot blame farmers selling their farm at a high price. Rice farmers decreasing rice profits. That’s the main reason they are complaining. Give them sufficient profits and they won’t complain. Remember these people also work 24/7 and is considered as one of the most physical demanding work in our country. Not everybody could till rice. I feel sad to this people involve that crisis in our country, in such things happens in their life they must be helped in our government itself .