MANILA, PHILIPPINES: Philippine President Gloria Macapagal-Arroyo has approved a 1.5-billion-peso (US$34.14 million) augmentation for the Department of Agriculture (DA) to increase rice production in the face of an 'unprecedented' supply problem on the country's staple food, Agriculture Secretary Arthur Yap said Wednesday (19 Mar).

The additional funds will be sourced from 'realigning' the budget of select government agencies with “less absorptive capacity”, and Budget Secretary Rolando Andaya is working on it, Yap said in a phone patch interview with reporters at the Palace.

"The President has approved augmentation budget for (rice) production, so we are expanding our wet season target areas, so the President has given 1.5 billion pesos additional for seed support," Yap said.

Arroyo said Tuesday (18 Mar) that rice prices were expected to rise, but promised there would be no shortage.

Yap said certified seeds instead of good seeds would be planted in irrigated lands that were not reserved for hybrid rice.

Certified seeds can yield four and a half tonnes per hectare while good seeds yield three and a half tons per hectare. Hybrid rice seeds yield 6.5 tonnes per hectare, he said.

"This is very critical. The most important thing to do in the wet season is to distribute, as much as possible, certified seeds so that in the irrigated areas that will not be planted with hybrid rice, they can at least be migrated to certified seeds," he said.

Yap said the 'thin' rice supply in the world market was putting pressure on local prices, unlike in 1995 when the country could import rice to address a 'supply problem'.

"What is happening right now is unprecedented," he said.

Yap refused to give an estimate on how much rice prices were expected to increase, saying he cannot 'speculate' on market movements.

Yap said the plan called for the planting of an additional 600,000 hectares (1.5 million acres) of rice during the rainy season in the country's top 10 poorest provinces, and another 500,000 hectares (1.2 million acres) in other provinces. Harvests expected in the months ahead also will beef up supplies, he said.

Yap said the government's rice reserve would last 57 days and that the National Food Authority (NFA) was receiving additional supplies from the international market.

"We're going to get additional support," he said.

The NFA said it has secured 500,000 metric tonnes (551,155 tonnes) of rice from Viet Nam and Thailand for delivery next month -- part of 2.1 metric million tonnes (2.31 million tonnes) to be imported this year.

Rising demand from the Middle East and Africa has hiked the price of rice in Viet Nam and Thailand -- the world's top exporters -- to up to $500 per metric tonne, a 25 percent jump from a month ago, the Agriculture Department said.

But even those countries are struggling to keep pace with export demand and there are fears they may curb sales to damp domestic prices and protect their consumers.

The Philippines consumes a total of 11.9 million metric tonnes of rice annually, most of which is grown domestically.

The market price has increased by an average of 3 pesos ($0.07) per kilogramme from a year ago, Yap said.

NFA chief Jessup Navarro has blamed dwindling rice fields for recurring shortfalls, with many farms in the country's rice growing region of Central Luzon converted to residential subdivisions, golf courses and shopping malls.

Arroyo last week earmarked US$69 million in an effort to cushion the impact of the rising world prices of rice, other goods and crude oil.

She also ordered an expansion of government's hunger mitigation programme, including expanding backyard vegetable farming and village food terminals, and intensifying swine restocking and livestock vaccination programmes. (By JOEL GUINTO/ The Philippines Daily Inquirer/ ANN)