The Department of Agriculture (DA) has successfully implemented a maximum suggested retail price (MSRP) for imported rice, leading to a notable reduction in prices and providing relief to Filipino consumers. The policy, introduced in early February, has resulted in a significant drop in rice prices without causing major disruptions to the rice industry.
Prior to the MSRP implementation, imported rice with 5 percent broken grains was priced at around P64 per kilo, despite softer global prices, tariff reductions, and a stronger peso. According to the Philippine Statistics Authority, the MSRP has played a crucial role in lowering rice prices and taming inflation, with March inflation figures coming in lower than both market and central bank expectations.
The MSRP initiative began at P58 per kilo and was further reduced to P49 per kilo by 1 March. Agriculture Secretary Francisco P. Tiu Laurel Jr. indicated that the MSRP could decrease again by 31 March, based on the ongoing softening of global rice prices and the continued strengthening of the peso. “If the current trend in world rice prices persists and the peso remains strong, we might lower the MSRP for imported rice to around P45 per kilo by March 31,” he said.
The decision to set the MSRP followed consultations with industry stakeholders to ensure the price reductions would not disrupt the rice industry or threaten food security. This initiative aligns with the recent decision by President Ferdinand Marcos Jr. to approve a reduction in rice tariffs from 35 percent to 15 percent, taking effect in July 2024. In addition, the lifting of India’s export ban on non-basmati rice in September last year has contributed to an increase in global rice supply.
As a result of these combined efforts, rice prices have reached their lowest levels in over two years, with some varieties priced below USD400 per metric ton. Secretary Tiu Laurel noted that the landed cost of good-quality rice from Vietnam had dropped to USD490 per metric ton by March, over USD200 cheaper than in November 2024 and approximately USD80 less than early January prices.
Meanwhile, the Philippine peso has regained strength after trading above P58 per US dollar since November. By mid-March, the peso strengthened to P57.225 per US dollar.
Tiu Laurel reassured the public that the drop in rice prices and the reduction in tariffs would not impact the P30 billion annual budget for the Rice Competitiveness Enhancement Fund (RCEF), which supports local rice farmers. He confirmed that the government has ensured the sustainability of the RCEF through the General Appropriations Act, which will continue funding through 2026 and beyond.
This expanded RCEF, supported by rice tariff collections, will provide funding for the next six years, enhancing the competitiveness of local rice farmers in the global market.
