By Jovee Marie N. dela Cruz & Jasper Emmanuel Y. Arcalas
The House of Representatives should look into the true state of the country’s rice inventory to ensure ample and affordable supply of the staple, a vice chairman of the House Committee on Appropriation said.
Nacionalista Party Rep. Luis Raymund F. Villafuerte Jr. of Camarines Sur made the statement after officials of the Department of Agriculture (DA) and the National Food Authority (NFA) fretted over a possible supply shortfall during the July-to-September lean months.
“[An] inquiry should be conducted by the House Committee on Agriculture and Food following fears that the country’s current buffer stock might not be enough to last during the lean months after this summer harvest season,”
Villafuerte said.
He said Congress should help Malacañang determine the real supply situation, and then draw up proactive measures to avert a possible supply shortfall later this year. These could include importing rice either by the government or by private traders under the minimum access volume scheme of the World Trade Organization (WTO).
Villafuerte said Congress could back immediate imports to enable the government to proactively maintain the ideal buffer-stock level, or equivalent to a 30-day supply of the national daily rice requirement, by the time domestic stocks dwindle during the lean months.
“Considering the time needed for shipments to arrive in the country from Day One of such negotiations, now would be the best time for the government to green-light such imports—but if, and only if, such action would be deemed warranted in the course of the proposed public hearings on the supply situation,” he said.
“Otherwise, there is absolutely no need for the government to entertain rice imports if the rice inventory will be found adequate for the remainder of the year [in the public hearings], as any unnecessary importation would unduly distort domestic supply and depress farm-gate prices of palay that would only hurt local farmers,” Villafuerte added.
Other than the three-month lean season, the Legislative-Executive Department Advisory Council (Ledac) has required the NFA to maintain a 15-day buffer stock at any given time. In Camarines Sur, Villafuerte
said he received information from NFA Provincial Manager Yolanda Navarro that the province’s buffer stock only totaled 42,293 cavans or 50-kilogram bags as of April 30. This is equivalent to three days’ consumption at Camarines Sur’s daily rice requirement of 13,840 cavans.
“NFA CamSur’s rice supply for three days’ consumption is but a tenth of the 30-day buffer stock level that the Ledac has prescribed for the NFA at the onset of the July-to-September lean months,” said the lawmaker, quoting Navarro’s letter to Villafuerte.
Navarro said exacerbating the supply problem for Camarines Sur’s NFA is that the food agency has struggled to compete with private grains traders in beefing up its inventory this summer harvest season. Traders have been buying palay from farmers at P20 per kg, higher than the government support price of P17.
The NFA said its palay purchases in the first four months of the year declined by nearly 82 percent to 10,092.65 metric tons (MT), from 54,750 MT recorded a year ago.
NFA Spokesman Marietta Ablaza said the food agency was only able to buy 201,853 50-kg bags of palay from local farmers during the January-to-April period. “That is 17 percent of our target of 1.2 million cavans”, Ablaza told the BusinessMirror in a recent interview. She attributed the NFA’s low procurement volume to the high farm-gate price of palay during the four month-period.
Ablaza said the NFA spent some P171 million to purchase the 201,853 bags of palay from local farmers.
The food agency is targeting to buy 4.6 million 50-kg bags of palay, or about 230,675.5 MT, this year, which is more than double the 107,877 MT bought by the agency in 2016. The NFA buys clean and dry palay at P17/kg. The food agency gives an additional incentive of P0.20 to 0.50/kg for delivery, P0.20/kg for drying and P0.30 for cooperative-development incentive fund for farmers’ organizations.
Agriculture Secretary Emmmanuel F. Piñol said the NFA should increase its buying price by P2 per kg, so it could compete with local rice traders and do away with importing rice to increase its rice stockpile. “The NFA should increase its support price. In the long run it will be cheaper for the NFA to buy local palay, because they will no longer have to pay taxes or tariffs for imports,” Piñol said in a recent interview with reporters.
The DA chief said he urged President Duterte to allow the NFA to have a buffer stock that would last for six months.
“[I suggested they] follow the Indian model. In India, when they are stocking up, they buy about six months’ worth of their rice requirements from farmers. This was the same suggestion that I made to the President,” Piñol said.