MANILA, APRIL 29, 2008
(STAR) TAKIN’ CARE OF BUSINESS By Babe Romualdez - There’s no doubt the global rice scenario is getting even grimmer. Poor countries that have been dependent on rice imports will be the hardest hit considering that rice producing countries are becoming more and more reluctant to trade. Compounding the problem is climate change which has wreaked havoc even on rich countries like Australia which has been going through the worst drought in years, with scientists warning the problem could worsen until the next few decades.

According to the International Rice Research Institute, the tight global rice situation will continue until 2010. Experts claim world rice stocks have declined from 130 million metric tons (MMT) to 70 million MMT, with rice prices now at a 10-year high. The World Bank had earlier predicted that the global demand for food will double by 2030. Put all of these against a backdrop of a global population explosion – with the number of people expected to grow by three billion by 2050 – and you have a potentially explosive situation. Even today, we are seeing the effects of a global crisis with the food riots in Haiti, Bengal, Mauritania, Senegal and other places.

In the Philippines, people particularly those belonging to the poorer sectors are beginning to feel the crunch, lining up under the heat of the sun jut to be able to buy three kilos of NFA rice. What’s also ironic is the fact that this country is host to IRRI and yet, it has never achieved rice sufficiency all these years. In fact, it has to import 2.1 million metric tons to maintain a two-month inventory. But even the prospect of buying rice supplies outside is getting uncertain since Vietnam, Thailand and other rice exporting nations have announced a ban on rice exports. Naturally, they’d like to make sure they have enough supply for their domestic consumption first, and who can blame them?

While the government has allocated P5 billion in subsidies to 300,000 poor families to cope with the rice crisis, this is just a short-term solution to a long-term dilemma. What this country needs is to achieve rice sufficiency – which most everyone agrees can ensure long-term food security for this country. This is easier said than done however, considering that a successful program hinges on a lot of factors, among them the construction and repair of irrigation systems, provision of post-harvest facilities, subsidies to farmers, technology support and others. A report by the International Rice Commission also disclosed that up to 30 percent of grains, or close to 1.4 million metric tons, are lost due to improper handling and the lack of drying and storage facilities. That’s about the same amount we have been importing from Vietnam and Thailand.

Of course, there’s been a lot of blame-shifting and finger pointing as to why we have not been able to achieve rice sufficiency, among them the failure of the Comprehensive Agrarian Reform Program with its loopholes that have allowed the unprecedented conversion of agricultural lands into commercial and residential areas. The 4.5 million hectares of farmlands are not enough – and government is trying to tap additional farmlands – even in places like the Iwahig Penal Colony in Palawan – to ease the rice situation.

Speaker Prospero Nograles and Palawan Rep. Baham Mitra are also advocating the concept of “corporate farm be required to plant rice for their employees and their families. This way, they will not have to compete with other Filipinos for the already low supply of rice in the market.

Even before legislators made the call, San Miguel Corporation has been making a careful assessment of the country’s rice situation, noting that it is possible to improve the productivity of existing 1.27 million hectares of rainfed/under irrigated rice lands. Making irrigation available will double the cropping season and improve yield by at least 20 percent more, or an equivalent of 0.59 metric tons for every hectare per season. The combined use of hybrid rice and the availability of irrigation on the previously rainfed or under-irrigated 1.27 million hectares or farmland can lead to a potential increase of 2.58 metric tons for every hectare per cropping season – or a total of 3.27 metric tons of palay which can easily address the country’s 1.8 million metric tons of rice deficit, the study disclosed.

San Miguel has been quietly forming joint venture partnerships with several financial institutions, cooperatives and local government units to implement corporate farming on 5,000 hectares of irrigated rice lands in Zamboanga del Sur. The Development Bank of the Philippines and the Land Bank will provide low-cost financing to SMC. Rice lands will be leased, hybrid seeds, fertilizers, pesticides, crop insurance and other necessary technical support will be provided with the manpower component to be supplied by farmers’ cooperatives which will also have a profit-sharing arrangement with SMC.

Of course, the plan is not only to grow the rice requirement of SMC’s more than 10,000 employees and their dependents but to also help the country become rice-sufficient. To this end, San Miguel has committed to put up a P47-million rice/corn post harvest facility, with the initial 5,000-hectare rice corporate farm with a P57 million working capital by the 4th quarter this year. Credit should go to San Miguel President Ramon Ang for this revolutionary project which could very well serve as a template for other corporations. This is not only an example of corporate social responsibility but proof that big companies can be proactive and engage in activities that can make a difference not only to the immediate communities they serve, but to the country as a whole.

Chief News Editor: Sol Jose Vanzi

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