The National Food Authority (NFA) said on Thursday that Vietnam and Thailand are likely to secure the contract for the supply of 750,000 metric tons (MT) of milled rice, as the Philippines races to stockpile the staple amid the onslaught of El Niño.
NFA officials made the pronouncement following an auction held in Quezon City. Bids submitted by Vietnam and Thailand were acceptable to the food agency’s Bids and Awards Committee.
Vietnam offered to sell 450,000 MT of 25-percent broken well-milled rice at $426.60 per MT, while Thailand offered to ship the remaining 300,000 MT at the same price via a government-to-government procurement scheme. The price includes cargo handling and freight costs.
“The notice of award may be made in the next three days, after which the [winning bidder] will submit the performance bond to the NFA,” said Patricia Galang de Jesus, vice chairman of the NFA Committee on government-to-government procurement.
The total volume auctioned off on Thursday includes the 250,000 MT standby rice stocks that the government had approved for importation to ensure that the country would have enough rice despite the onslaught of El Niño.
NFA Administrator Renan Dalisay earlier said the government has decided to secure the entire 750,000 MT, while international rice prices remain affordable due to ample stocks.
Dalisay said the price of imported rice might go up in the next few months as El Niño-affected countries are expected to beef up their rice supplies. The Philippines will pay Vietnam $191.97 million, while Thailand will be paid $127.98 million.
Delivery of the rice shipments will be made on a staggered basis. For the 250,000 MT standby stocks, half will be delivered by the end of November, while the other half will arrive in the country by the end of December.
The 500,000 MT intended for 2016 will be shipped in the first quarter of next year—175,000 MT by the end of January; 175,000 MT by the end of February; and 150,000 MT by the end of March.
Data from the Philippine Statistics Authority showed that the country’s total unmilled rice production for 2015 may decline slightly to 18.86 million metric tons (MMT) from 18.97 MMT produced last year due to the effects of the drought.
The projected output is 1.22 MMT short of the national rice production target of 20.08 MMT for 2015.
The Philippine Atmospheric, Geophysical and Astronomical Services Administration earlier reported the dry spell caused by El Niño may intensify in the last quarter of the year, and would persist until summer of next year.