Philippines Targets Higher Rice processing Efficiency with Expanded Systems
Table of Contents
Agriculture Secretary Francisco Tiu Laurel Jr. (PNA photo by Ben Briones)
MANILA – Agriculture Secretary Francisco Tiu Laurel Jr. unveiled a strategic initiative to maximize the operational capacity of Rice Processing Systems (RPS) nationwide, addressing concerns regarding potential overcapacity within the rice milling industry. This actionable plan seeks to enhance income opportunities for local palay farmers and bolster the overall efficiency of the rice value chain.
Understanding Rice Processing Systems
RPS encompasses a network of rice processing facilities designed to support Filipino palay farmers. These systems are funded through the Rice Competitiveness Enhancement Fund (RCEF), established under the Rice Tariffication Law (RTL) to strengthen the domestic rice industry in the face of increased import competition.The RTL, signed into law in 2019, aimed to liberalize the rice trade while providing support to local farmers [RTL Law].
Secretary Tiu Laurel emphasized that achieving high capacity utilization is paramount, surpassing the importance of simply having a large milling capacity. “Our target utilization rate is 80 to 85 percent. That’s where efficiency improves, costs go down, and all parties -millers, farmers, and consumers-benefit, provided other costs hold steady,” he stated.
Currently, RPS operators must achieve at least 63 percent capacity to reach the break-even point. Falling below this threshold results in financial losses, according to the agriculture chief.
Did You Know? …
The Rice Tariffication Law allocated ₱10 billion annually for six years to RCEF, supporting programs like RPS development.
PhilMech’s Role in RPS Expansion
To accelerate the implementation of this strategic plan, Secretary Tiu Laurel is advocating for an expansion of large-scale RPS through the Philippine Center for Postharvest Development and Mechanization (PhilMech). PhilMech has already established 122 of the 151 RPS units planned, each equipped with advanced multi-stage rice mills and recirculating dryers.
Notably, 116 of these RPS units were completed during the current Marcos administration. PhilMech is committed to finishing the remaining 29 units before the end of the year. This expansion is crucial for modernizing the country’s postharvest infrastructure and reducing rice losses.
RPS Capacity & Utilization – A Snapshot
| Metric | Value |
|---|---|
| Total Target RPS Units | 151 |
| RPS Units Established (as of August 2024) | 122 |
| RPS Units completed Under Marcos Administration | 116 |
| Target utilization Rate | 80-85% |
| Break-Even Capacity Utilization | 63% |
A higher utilization rate translates to lower costs and increased profitability for all stakeholders in the rice industry.
Pro tip: …
Investing in modern rice processing technology, like that found in RPS units, can substantially reduce postharvest losses and improve rice quality.
What impact will these RPS improvements have on the price of rice for Filipino consumers? and how will this initiative address the challenges faced by smallholder palay farmers in accessing these facilities?
the Future of Rice Processing in the Philippines
The Philippines has long been striving for rice self-sufficiency. Investments in postharvest infrastructure, like RPS, are a critical component of this goal. Beyond simply increasing capacity, future efforts will likely focus on improving the quality of milled rice, reducing postharvest losses further, and strengthening linkages between farmers and millers.The success of the RPS program will depend on effective management, farmer training, and access to financing.
Frequently Asked Questions about Rice Processing Systems
- What is a Rice Processing System (RPS)? RPS refers to a set of facilities designed to process palay into rice,aiming to improve farmer income and rice quality.
- What is the Rice Competitiveness Enhancement Fund (RCEF)? RCEF is a fund established under the Rice Tariffication Law to support the competitiveness of the Philippine rice industry.
- What is the target utilization rate for RPS units? The target utilization rate is 80 to 85 percent.
- How many RPS units have been established to date? As of August 2024, 122 RPS units have been established.
- What is the break-even capacity utilization for RPS operators? Operators need to hit at least 63 percent capacity usage to break even.
We hope this article provided valuable insight into the Philippines’ efforts to enhance its rice processing capabilities. Share this article with your network, leave a comment below with your thoughts, or subscribe to our newsletter for more updates on agricultural developments in the Philippines!
