NFA preparing for possible gov’t-to-gov’t rice import delay
THE National Food Authority (NFA) said it is closely monitoring rice stocks in case of disruption to plans for government to government importation during the lean months.
The agency said it recently assembled its regional directors for an “emergency” strategic planning meeting “in view of the possible effect on local rice inventories” due to the delay in approval by the NFA Council for government-to-government negotiations for the proposed immediate importation of half of the 500,000 metric tons ( MT) rice import quota approved last year.
“Delaying further the approval for the G to G ( government to government) importation of the 250,000 MT balance could adversely affect the buffer stock position of the government and make it difficult for NFA to maintain the minimum levels of food security rice requirements during normal times, more so during the lean months period,” NFA administrator Jason Laureano Y. Aquino said in a Thursday statement.
“Any further delay in getting the 250,000 MT into our government warehouses may lead to disastrous consequences,” he added.
The first tranche of the quota was activated in August last year with Vietnam and Thailand winning the bid.
The NFA proposed the importation of the remaining amount as early as November, citing an expected shortfall in rice production due to typhoons Karen, Lawin, and Nina which hit the country late in 2016.
The NFA Council did not act on the proposal amid the lack of a recommendation from the interagency National Food Security Committee (NFSC) chaired by the National Economic and Development Authority, which recommends to the council whether the country will need to ship the grain based on existing rice stocks.
To date, the NFSC has not made any recommendations for rice shipments under the scheme.
The NFA said it may find it challenging to compete with private traders who buy from farmers at P18-P20/kg compared with the government’s support price of P17/ kg, even with additional incentives amounting to P0.70-P1.00/kg.
Raising inventory levels will also deter price manipulation, hoarding and price speculation as the agency is also mandated to stabilize the price and supply of rice, according to Mr. Aquino.
“Although we have enough procurement funds to buy local harvest, our farmers would be better off selling to private traders at higher prices. Thus, we cannot possibly build up our mandated 30-day food security buffer stock before the lean months via local procurement alone,” he added.
Under the law, NFA is mandated to maintain a rice buffer stock good to last for 15 days at any given time and for 30 days at the onset of the lean months from July to September, based on a daily consumption requirement of 32,150 MT or 643,000 bags.
As of March 8, the government’s rice inventory was at 400,000 MT, good for about 13 days. —