After months of uncertainty surrounding the country’s rice supply-and-demand situation, the government finally announced last week its decision to buy rice from foreign private suppliers. The National Food Authority Council (NFAC), the interagency body vested with the power to decide on the timing and volume of rice importation, has also given its nod to the private sector’s initiative to buy 805,000 metric tons (MT) of rice via the minimum access volume (MAV) scheme. The announcement came after revelations that the NFA’s buffer stock had fallen to eight days’ worth of national consumption, nearly half of the 15 days buffer mandated by the Legislative-Executive Development Advisory Council (Ledac).
Days after the NFAC made its announcement, however, it has yet to determine the final volume of rice the government would buy via the so-called government-to-private (G2P) scheme. Cabinet Secretary Leoncio B. Evasco Jr. said the rationale behind this is to ensure that the purchases would be covered by Republic Act 9184, or the Government Procurement Reform Act. As we go to press, the NFAC has yet to decide on the final volume of rice imports and when it would conduct the bidding.
It is now becoming more apparent that the National Food Authority (NFA) would not be able to build up a stockpile equivalent to 30 days of national rice consumption before the start of the lean season in July. It could take anywhere from one to two months for the rice imports to arrive in the country and this would depend on how fast the government would conduct the bidding and award the right to supply rice, as well as the origin of the imports.
The decision not to import rice undoubtedly benefited the farmers during the dry season harvest as traders in some areas were buying paddy rice for as much as P22 per kilogram. There is nothing wrong in favoring local producers because it is the obligation of the State to safeguard the livelihood of its citizens. But some members of President Duterte’s Cabinet seems to have conveniently forgotten or refused to recognize the nature of the Philippine rice industry.
Given its mandate, the NFA continues to act as the “big, bad wolf” to private traders because its intervention prevents price spikes, which could hurt producers or consumers. Until and unless this function is scrapped via the amendment of pertinent laws, this should not be swept under the rug or disregarded and should have been used to the government’s advantage.
For one, the Duterte administration should have embarked on massive palay-buying and raised the NFA’s support price to boost the food agency’s stockpile. This is cheaper than importing rice and would benefit more farmers. Also, importations should be timed to ensure that the price of unmilled rice during the dry season and main harvest in the fourth quarter would not go down. The announcement of the government’s decision to import rice last week would no longer affect rice farmers but it could have an impact on prices during the main harvest, particularly if the arrival of the imports via G2P and the MAV scheme are ill-timed.
It takes about three months to grow rice so the government would have ample time to estimate the possible shortfall in the country’s rice requirement. Importation should be the government’s last resort, but if it is certain that local production would not be enough to support its citizens’ needs, then it should do what’s necessary to ensure the availability of affordable rice.