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Sunday, April 20, 2008

Rice Crisis - An Environmental Problem

Sunday, April 20, 2008 Posted by Vernon Go , , , No comments

March 2008, and the same scenario appears to be playing out once more, this time with a major difference. The problem back in 1995 was purely internal to us; nowadays the rice supply tightness extends well beyond our shores. And while we could have avoided the rice queues back then with a timely decision by NFA to import the commodity, these days even finding a source to import the vital commodity from has not been easy. And our import requirement now, running well over 2 million metric tons, is almost three times what we needed to import back then. (We had in fact even managed to make a small export shipment, about 35,000 tons, just three years before that 1995 rice crisis.)

The problem with the world rice market then and now is that it is a relatively thin market, with only about 7 percent of total world production being traded internationally. And now, India and Vietnam—both key suppliers in world rice trade—have both cut back exports due to rapidly growing internal demands for the commodity. China, also facing surging demands due to rapidly rising incomes coupled with large-scale conversion of farmlands into industrial and residential zones, has switched from being a net rice exporter to being a net importer.

It was thus fortunate that we even managed to secure a supply contract with Vietnam for a million metric tons last week, the language of which some think may not even be a solid commitment to provide the commodity if and when crunch time comes.

Largest importer


We now have the dubious distinction of being the largest rice importer in the world—the result of rice productivity lagging behind our rapidly growing population. Irrigation coverage, the single most important determinant of our rice productivity, had reportedly even declined (to less than a third of our total irrigable area), due to deterioration and non-maintenance of existing facilities through the years. And this happened notwithstanding a law passed in the 1990s (albeit unenforceable from the start) that would have us attain 100-percent irrigation coverage in 10 years—proof that a country cannot simply legislate its way out of a problem.


Our rice productivity had in fact been declining through the years. Apart from declining irrigation, many years of unsustainable inorganic and chemical-based monoculture rice farming had apparently been degrading the soil in our traditional rice lands. Declining irrigation itself was also the result of deteriorating watersheds owing to rapid forest degradation. On top of that has been the continuous conversion of prime farm lands into non-farm uses.


Age-old failures


But it is not only science that will solve our rice problem. Declining productivity has as much been the result of an institutional environment that gave little incentive nor capability for farmers to invest in productivity improvements. With rice cartels lording it over rice trading, rice farmers continue to receive farm gate prices that are hardly remunerative. And with farm credit continuing to be dominated by usurious informal lenders and traders themselves, farmers have little capability to spend for productivity enhancements even if they were available.


The short-term solution to the current difficulty is inevitably more imports, to the extent that we can find the rice to import. Over the longer term, there is no escaping facing up to and coming up with new approaches to our age-old failures in the basics: Irrigation, farm credit, and addressing the uncompetitive elements in the rice trading system. Meanwhile, we’re in for even higher rice prices, and that’s a reality we can’t seem to avoid, at least for the near future.

The Philippines is facing "a perfect storm," said Sen. Mar Roxas, president of the Liberal Party. Problems coping with rising rice prices are compounded by higher oil prices and a US economic downturn, which could reduce the money sent home to families by Filipinos working in the United States. Such remittances underpin the economy.

The International Rice Research Institute (IRRI), "Rice is so central to the lives of most Asians that any solution to global poverty and hunger must include research that helps poor Asian farmers reduce their risks and earn a decent profit while growing rice that is still affordable to poor consumers."

The Irony of it all, our President is a BS in Econ, MS in Econ, Dr. in Philosophy, and it is in the Philippines that the International Rice Research Institute is stationed and yet we are having this crisis?? An archipelago with a growing 86million population, having the best Environmental Laws in the world and yet we are striving to be a first world country by 2030? Before we can do that we must change our ways and start caring for our environment for it is where we get our food and oxygen, how hard is it to understand that? This is the price of taking the “common path” towards industrialization and if our country allows more environmental “Sins” to happen (Like the stupid oil explorations in the Visayas) then we might as well leave this silly country of ours and make our own “pinoy-defacto-nation”. Would you rather flatten down a forest to convert it to a farm than to convert a golf course into a farm?

"A Sustainable Ecology is need for a sustainable economy."


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