WP 2020-04: Trade Shocks and Philippine Rice Imports Amidst SARS-CoV-2

Working Paper No. 2020-04
Trade Shocks and Philippine Rice Imports Amidst SARS-CoV-2
Gerald Gracius Y. Pascua

In the midst of the Severe Acute Respiratory Syndrome Coronavirus 2 (SARS-CoV-2) global pandemic, rice exporter Viet Nam is mulling suspension of their rice exports. Should the Philippines, as one of the world’s biggest rice importers, worry about its rice stock? If one will consider the dynamics of rice trade in the region, the country should not fear as much about supply yet. A more significant concern in the foreseeable future; however, will be the resulting increase of prices in the global market as demand picks up. In the extreme case that Viet Nam halts its exports for the rest of the year and the Philippines imports an additional 0.3 MMT as proposed by the Department of Agriculture, the market shocks may contribute to an estimated 43 percent increase in the price of milled rice this year. The Philippines has to consider further diversifying its import sources by tapping other rice exporters in the region in order to emerge with a stronger trade position after this pandemic.

Keywords: export restriction, trade diversification, international trade, rice, SARS-CoV-2, ASEAN