Explaining the increasing per capita rice consumption in the Philippines

Reported documents,showed that the domestic rice consumption in the country has increased from 8,086 to 12,961 thousand metric tons from 2000 to 2008. The BAS and FNRI estimates of per capita consumption based on food consumption survey showed upward trends over the survey years covered. This study attempts to explain the reasons why per capita rice consumption in the Philippines is increasing, which has implications in the country's food security as well as the targeted rice self sufficiency.Data used in this study came from BAS and FNRI surveys.Results of the study revealed that the increasing annual PCRC can be explained by substitution from carbohydrate rich food . A one percent increase in the price of corn grits increased PCRC by 0.13 percent. The lower income class consumed more rice than higher income class. The other explanation to increasing PCRC is over/underestimated parameters of the Supply Use Accounting (SUA) framework used by BAS. Overestimated parameters in the supply side tend to overestimate the supply and hence the per capita rice available for consumption, while underestimated parameters in the utilization tends to overestimate the consumption. Using the new parameter the estimated per capita consumption yielded 7 percent lower in per capita consumption compared to the result of the existing parameters. The volume of smuggled rice is declining through time. The annual PCRC based on SUA estimate in 2001 has been low at 103.77 kg/year, which could be attributed to the huge volume of unaccounted rice stocks brought into the country via smuggling valued at P286 million. the analysis of relationship between PCRC and value of apprehended smuggling was negative significant. This result indicates that the declining rice smuggling in the past had contributed to the increasing PCRC. Given the results of this study, it is recommended that corn-eating provinces be encourage to get back to corn by making corn available at lower price. Adjust the parameters used in SUA to have a realistic estimate of supply and demand of rice. Domestic rice should be made competitive in the world market to discourage smuggling