THE National Food Authority (NFA) will most likely be able to buy around 270,000 tons of palay from local farmers or almost half of what it hopes to buy under its domestic procurement program for 2011. 

NFA Administrator Angelito T. Banayo said they will continue to shoot for the 500,000-ton local palay procurement target for 2011 but he conceded that the agency may be hard pressed to meet this goal. 

“The funds we have [on hand] is good for [the purchase of] 250,000 tons of palay. Whatever we can save, we will use for the purchase of more palay,” said Banayo in a chance interview during a recent hearing on the Department of Agriculture’s (DA) budget for 2012 at the Senate. 

He said the agency will use the P1.5 billion in service fees it earned from the rice-importation program this year, as well as the P2.5 billion in subsidy it received from the DA for the palay procurement program. 

“We can buy as much as 270,000 tons of local palay for P4 billion. Whatever we save from our sales, it will go directly to palay procurement. That’s why I want to continue to shoot for the 500,000 tons,” added Banayo. 

In the first quarter of 2011, the food agency had targeted to buy as much as 870,000 tons of palay from farmers. The volume represents 5 percent of the 17.4-million ton palay output target for 2011. Buying that volume would require P14.79 billion.  

But because the NFA’s corporate budget had been reduced and with less imported rice to sell, the agency had to pare down its procurement target. 

As part of its mandate of stabilizing farm-gate and retail prices of the country’s main staple, the NFA buys palay from farmers at a support price of P17 per kilogram. 

In a position paper on the DA’s 2012 budget, Rice Watch Action Network (R1) asked Congress to increase the NFA’s budget to P14 billion, the bulk of which will go to the procurement of 5 percent of local-palay production. 

R1 lead convener Jessica Reyes-Cantos said this is a way of encouraging local palay farmers to increase their output.  

Palay purchased by the NFA from farmers form part of the agency’s buffer stock. The agency is mandated to have a buffer stock equivalent to 30 days of daily consumption during the lean months of July, August and September. 

The increase in the domestic procurement of palay is one of the strategies the government wants to implement to enable the Philippines to achieve rice self-sufficiency by 2013.  (Jennifer A. Ng)