Manila’s 203,000-metric- ton (MT) rice tender on Tuesday failed after Bangkok and Hanoi opted not to participate in the government-to-government (G2G) bidding due to concerns over the approved importation guidelines.
Notwithstanding this development, the National Food Authority (NFA) expressed confidence that the retail price of rice would remain stable and even go down further sans the arrival of the 203,000 MT.
NFA Assistant Administrator Maria Mercedes G. Yacapin said the NFA has ample supply to sustain the volume of rice it sells in the market, which is currently pegged around 15 percent to 20 percent of the total market requirement.
Nonetheless, Yacapin still expressed dismay that the G2G bidding failed, as the agency is seeking to further beef up its present rice inventory.
“With all the need and the appeal, somehow you are expecting to award some volumes. We we’re ready,” Yacapin, who chairs the NFA Committee on Government-to-Government Procurement, said in an interview with reporters after the bidding.
“But personally, I’m not worried because we have the stocks in our warehouses, and we are able to purchase palay as the harvest is ongoing. And the retail prices are going down, which means lesser pressure on the part of the NFA,” Yacapin added.
The NFA currently has a stockpile that is good to last for 68 days based on its present market participation rate.
Hanoi did not participate in the bidding, citing concerns over Manila’s “terms of reference [TOR] regulations.”
In a letter to the NFA, Vietnam Southern Food Corp. II Deputy Director General Bach Ngoc Van said his country “could not meet” the NFA’s “terms of reference regulations.”
Thailand, on the other hand, said it is “concerned” with present TOR and pointed out that it would be “difficult” for Bangkok to comply with the guidelines.
Thailand cited various provisions of the TOR that did not sit well with them, such as reassignment of discharge ports, fumigation conditions and penalty for short delivery, among others.
Bangkok’s concerns were submitted to the NFA through a letter signed by Department of Foreign Trade Ministry of Commerce Director-General Adul Chotinisakorn on the day of the bidding.
Safe
Agriculture Secretary Emmanuel F. Piñol said he is not worried over the G2G bidding failure as the NFA has ample stockpile and the government has put in place measures to stabilize retail prices of rice.
However, Piñol said, he still maintains that the 203,000-MT volume should be bidded out before the year ends to ensure that the government has sufficient buffer stock in times of calamity.
“My only concern is that the volume should arrive by December. While we have enough rice right now, I am not worried. We have an SRP [suggested retail price] so traders could not speculate,” he said in an interview with reporters on Tuesday afternoon.
“But I still would not want to repeat the situation wherein the NFA stocks are depleted. We are still expecting six typhoons before the year ends and that it means we would need another requirement for rice,” he added.
Piñol said that, with the arrival of the NFA’s 47,000-MT rice imports, as well as the trade department’s importation program, the country has enough rice to meet its demand.
“We are safe, but we are playing it safer,” he said. “I want to hold on the physical stocks. This is what the President wants to happen that there is more than enough inventory.”
Changes
NFA OIC Administrator Tomas R. Escarez said they are currently reviewing the concerns of Thailand and Vietnam and would submit their recommendations to Piñol and the NFA Council.
Escarez disclosed that both Vietnam and Thailand sought for an extension of the import arrival until December 31 as they could not meet the December 15 deadline set by the TOR.
Piñol said he is amenable to move the deadline as the NFA is still expecting more imports from its previous tenders.
Furthermore, Escarez said they are also looking into the concerns of Thailand over the new stricter sanitary and phytosanitary measure under the TOR, as well as the penalties imposed on short shipment.
The NFA set new guidelines to ensure the food safety of the rice imports, particularly to avoid the issues of weevil infestation that happened in the past, according to Escarez. Furthermore, the approved TOR has put in place penalties for short shipment as suppliers tend to abuse it, he added.
“Before, there was no penalty and we did not pay attention to it. But they abuse the deliveries, wherein for example shipments lack 1,000 bags or 2,000 bags,” he said. “So, the tendency is that we expect this amount of inventory but it would not fully arrive.”