The opening up of our rice market to imports under the Rice Tariffication Act (RTA) will be good to our country in the long run. The retail price of rice will moderate in line with the world market price to the benefit of consumers and the economy as a whole. The rice farmers, on the other hand, will suffer an immediate decline in income. The more progressive among them who are cultivating rice under favorable conditions (i.e. with irrigation) will be able to hold their own against the low-priced rice inputs from Vietnam and Thailand. But the farmers cultivating the lands not favorable to rice growing (i.e. rainfed) will be obliged with government’s help to shift to other crops often more profitable than rice, and/or into livestock and fish culture. In fact, with market support, they may end up with higher income than those growing rice alone (rice monoculture).
Also as a consequence, we shall produce less rice and therefore be more dependent on imports. But we will produce more of the other commodities which are more valuable than rice and create more livelihood opportunities.
It is therefore in our country’s long-term interest to persevere and stay the course with the RTA. But to make RTA work, we have to embark in three complementary strategies/directions, namely: 1) direct decoupled payments to rice farmers to provide them immediate relief, 2) further intensification of rice efforts in productive irrigated lands, and 3) diversification of rainfed rice lands into other high value crops, livestock and fish culture.
This turn-around of the rice industry will easily take 10 years to attain. The burden of transition to an open market should not borne by the rice farmers alone. The farmers need help in the transition while Strategies/Directions 2 and 3 are being installed. Hence, the necessity to commit ALL the tariffs collected under the RTA as direct cash payments to farmers (Strategy/Direction1).
The second Strategy/Direction is fairly straightforward: 1) continuing investments in irrigation development, but tactically in the next five years, more attention to rehabilitation and more effective operation and maintenance of existing irrigation systems, 2) universal use of high-yielding inbred seeds and increasing adoption of hybrids and more fertilizers to ensure high yields, and 3) more mechanization to reduce labor costs and to minimize post-harvest losses.
However providing these inputs free, as provided for in the Rice Competitive Enhancement Fund (RCEF) of the RTA, has been proven time and again to be wasteful, graft-prone and expensive. The better way is to provide farmers easy access to credit with which to purchase these inputs. The government subsidy should be in the form of more dedicated credit technicians to be deployed by Land Bank of the Philippines, affordable low interest, crop insurance and loan guarantee for the banks. Credit support will be cheaper, more efficient and more sustainable in the long term. The RTA should therefore be amended accordingly.
Diversification of rainfed rice lands into high value crops, livestock and fish culture
Depending upon the terrain, soil type and access to market, the rainfed rice lands can be devoted to a wide range of annual crops, tree crops, as well as to livestock and fresh-water fish culture. Rainfed lands may be marginal for rice growing but perfectly suitable for these other commodities/enterprises.
For low-lying, poorly-drained areas, they can very well be converted into fish ponds for the culture of tilapia, hito and dalag. They can also be drained by digging a permanent network of canals and planting crops on the elevated portions much like the sorjan cultivation system widely practiced in Indonesia.
After the first crop during the rainy months which is usually rice, the second crops could be leafy vegetables like pechay and mustard; solanaceous crops like tomato, chili pepper and eggplant; beans like peanut, mungbean, and soybean; onion and garlic, and cucurbits like squash, and melons.
For the better-drained areas subject to occasional flooding, perennial fruits like pineapple, papaya, bananas (dessert and plantain), lanzones, durian, rambutan, jackfruit, tamarind, avocado, etc. can be grown. The trees can be planted in raised beds to enhance drainage and root aeration.
For the long-term, drip irrigation systems should be installed not only to provide timely, supplemental water during the dry months but also for efficient direct delivery of fertilizers and systemic pesticides and bio-stimulants into the root zones of the crops.
Drip irrigation units are modular and becoming cheaper to install than conventional surface irrigation systems. But even now drip irrigation units can pay for themselves in the commercial production of high value tree crops for domestic consumption and for export.
Alternatively, the rice fields can be converted into high yielding forage crops to feed dairy cows and buffaloes and small ruminants like goats and sheep.
Para grass, a water-loving tropical pasture grass grows exceedingly well under partly flooded conditions. A hectare of Para grass can support under grazing management 40 female goats (ewes) producing at least 60 kids a year. At ₱2,000 per weaned kid, the gross income is ₱120,000 per hectare per year with hardly any labor cost and little cash cost for dewormers and occasional feed concentrate. I have demonstrated this in my farm.
The same hectare of Para grass can support as many as 10 milking cows in a cut-and-carry system with moderate levels of fertilizers and manure recycling. The investments in dairy cows are of course very high but the income per hectare from 10 dairy cows will easily be 5–8 times that from two crops of rice.
The input requirements of these diversified farm lands will be varied and often higher than those required for rice. In the same manner, these inputs should not be given away free to the farmers but must be acquired through subsidized credit.
Market support — the key
Unlike grains which are relatively easy to store and transport, these other crops are perishable and require better organized supply chains. Before the farmers embark into planting these other crops, their markets must be assured through contract growing arrangements with local buyers, supermarkets and/or food processors and exporters.
Better yet, instead of just being raw material suppliers to the food processing plants, arrangements can be made for the farmers to become part owners in joint ventures through agreed deductions from the produce they deliver to the processing plants.
The farmers will have better leverage if they can produce in the volumes and times of delivery required by the market. This will require concentration of production in designated areas close to the processing plants not only to facilitate extension but also reduce the cost of assembly of produce and to minimize post-harvest losses. The adoption of the one-town-one-product approach and empowerment of farmers’ cooperatives will be crucial.
Dr. Emil Q. Javier is a member of the National Academy of Science and Technology (NAST) and also Chairman of the Coalition for Agriculture Modernization in the Philippines (CAMP).
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