The National Food Authority’s (NFA) has bought 4 million 50-kilogram bags of unhusked rice in May, or more than a quarter of its procurement target for 2019, bolstering the claim of the agency that farmers find its buying price attractive.
The food agency said its procurement of 201,250 metric tons of palay as of May 20 has already eclipsed the 71,420 bags (3,571 MT) of rice it bought in the first five months of 2018.
The NFA said it has procured 4.025 million bags as of May 20, which already eclipses the 71,420 bags that the food agency bought in the January-to-May period last year.
The food agency’s procurement in the first five months is 27.83 percent of its target of 14.46 million bags, or 723,000 MT, for 2019.
Its new goal is nearly double its original
procurement target of 7.78 million bags, or 389,000 MT, for 2019. It is also
significantly higher than the 1.24 million bags, or 62,000 MT, purchased by the
food agency from
farmers last year.
The NFA has been aggressively buying unhusked rice from farmers in recent weeks following the deregulation and liberalization of the country’s trade regime, NFA-OIC Administrator Tomas R. Escarez said.
“More farmers are selling to NFA because we have increased our effective buying price, with the additional P3.00 per kilogram Buffer Stocking Incentive (BSI) starting last October 2018, in addition to the previous P0.20/kg drying, P0.20/kg delivery and P0.30/kg Cooperative Development Incentive Fee,” he said.
“This increased the agency’s maximum buying price for palay from P17.40/kg for individual farmers and P17.70 for members of farmer cooperatives/organizations to P20.40/kg and P20.70 per kg, respectively,” Escarez added.
The NFA’s effective total buying price at present is more than P4 over the prevailing buying price of traders at P18.45/kg, the NFA said, citing Philippine Statistics Authority (PSA) data.
Under the rice trade liberalization law, the NFA would be reduced to a buffer stocking agency mandated to keep a stockpile level of 15 million to 30 million bags, Escarez said.
The NFA said it procured 155,107 bags in January, 123,283 bags in February and was able to hike its purchases at the start of summer crop harvest in May at 994,932 bags. The NFA said it has bought 954,142 bags from May 1 to 20.
Agriculture Secretary Emmanuel F. Piñol told the BusinessMirror that the NFA would adopt a “rolling” buffer stock with an “optimal level” of 15 to 30 days’ worth of consumption and will still be allowed to purchase palay beyond that level.