The National Food Authority (NFA) said its purchases of unmilled rice from local farmers expanded by nearly 80 percent to 50,608 metric tons in January to November, from last year’s 28,278 MT.
The NFA said it has procured some 1.012 million 50-kilogram bags during the 11-month period, 92 percent of which were bought in October and November.
In two months, the NFA said it was able to purchase 926,854 bags due to the additional P3 per kilogram buffer-stocking incentive (BSI) added to the government’s support price of P17 per kg.
“This means that given the right price, the NFA will be able to buy more from our farmers,” NFA OIC Administrator Tomas R. Escarez said on Tuesday.
“With the additional P3/kg incentive, we were able to entice more farmers to sell their harvest to us. At a time when private traders were buying at P20.28 or lower than the NFA buying price, our farmers decided to sell to us instead,” Escarez added.
The NFA currently buys palay from local farmers at P20.70 per kg, inclusive of the P0.70 per-kg delivery, drying and cooperative incentives.
As the main harvest season reached its peak in November, the NFA said it was able to purchase 630,934 bags of palay.
The NFA said it was able to buy palay from farmers in Occidental Mindoro, Mamburao, Batangas, Oriental Mindoro, Bukidnon, Isabela, Capiz, Iloilo, North Cotabato and Camarines Sur.
The food agency attached to the Department of Agriculture has targeted to procure 2.6 million bags, or 130,000 MT of palay. To hit this goal, the NFA must buy 1.6 million bags, or 80,000 MT of palay.
Last year the NFA failed to achieve its goal of procuring 3 million bags, as it managed to purchase only 588,820 bags, or 29,441 MT.
Since the approval of its P3 per-kg BSI, the NFA has become more optimistic in achieving its palay procurement target for 2018.
The NFA is banking on local palay procurement to continuously beef up its stockpile and avert the depletion of state-subsidized rice sold in local markets.
Out-quota rice
The NFA also disclosed that 30 agricultural firms, traders and farmers cooperatives are seeking to import about 274,476 MT of rice via its out-quota program.
Based on the initial list of applicants published by the NFA on its web site, 30 private entities have already applied for permits to import rice outside the minimum access volume (MAV) since November 26.
Among the applicants include Manila-based Pure Rice Milling and Processing Corp. that seeks to import 100,000 MT of white rice, 25-percent brokens from Thailand and Farm Mechanism Resources and and Distribution Corp. that signified its intent to buy 20,000 MT of white rice, 5-percent brokens, also from Thailand.
The 30 interested importers are planning to purchase rice from Vietnam and Thailand.
Rice importers are allowed to bring in rice with a quality of 25-percent brokens or even better.
The NFA issued the guidelines for the out-quota rice importation on November 23 following its approval by the NFA Council (NFAC) on November 21.
“The purpose of the importation is to bring down the prices of rice,” Agriculture Secretary and NFAC Chairman Emmanuel F. Piñol told reporters in an interview after the NFAC meeting on November 21.
Rice imports within the MAV of the World Trade Organization are slapped a tariff of 35 percent, while those bought into the country outside of the quota are levied a tariff of 50 percent.
Piñol said the NFAC has decided to allow out-quota importation to ensure that the retail price of rice would remain affordable to Filipino consumers.
“Why would I wait for [the rice tariffication]? What if it would take longer? Then consumers would complain that rice prices are increasing,” he said.
According to Piñol, interested traders need to meet only three requirements approved by the NFAC—show proof of financial capacity, warehouse capability and retail capability.
“These will effectively weed out fly-by-night importers who just apply for import permit and sell them afterward,” he said.
Image credits: NFA Photo