Indian exporters see a chance to ship more of the foodgrain to Philippines as the Southeast Asian country lowers the rice import tariffs in order to raise its supplies, Philippines is one of the region's largest grain buyers.
As per the reports from Manila, the Philippines reduced the most favored nation tariff on rice imports from 40% to 35% for in-quota sales and 50% for out-quota volume for a year.
Again for the past few years, Indian exporters have been seeking Manila to equalize the duty system after being hit with a 50% higher rice import tariff in the Philippines. However, due to import shortages from conventional producers such as Vietnam and Thailand, Manila has been pushed to reduce tariffs in order to keep cereal prices in place.
“This is a positive change for us. The Rice Exporters Association's President, BV Krishna Rao, said, "We are now on par with other ASEAN countries." “We are still awaiting real orders,” Rao said, adding that this would free up a demand in the Philippines of around half a million tonnes.
Philippine's rice market
The Philippines' annual rice import demand is expected to be about 2.5 million tonnes. The demand for high-quality rice is estimated to be around two million tonnes, while the market for lower-quality rice is estimated to be around half a million tonnes. The Philippines mostly receives high-quality aromatic and glutinous varieties from Vietnam and Thailand.
In the Philippines, Indian Basmati rice is not common because it is more expensive than Thai Jasmine and other fragrant varieties. The Thai varieties are priced at $700 per tonne, while Basmati is priced at $1,000-1,200 per tonne.
Rice exports from India to the Philippines have been fluctuating in recent years. “In the long term, it is a strong environment where we can increase our market share,” Rao said.
