The National Food Authority (NFA) will tap a P50 billion credit facility from the Development Bank of the Philippines (DBP) and Land Bank of the Philippines (LandBank) to add to the country’s buffer stock of rice in preparation for El Niño.
NFA administrator Roderico Bioco said the food agency may have to procure more rice to ensure supply and price stability.
“That’s more than adequate to cover whatever financial requirements we need,” he said in a press briefing Friday.
The agency defers to the national government for guidance on procurement volume.
Bioco said the NFA cannot wait for the Philippine Statistics Authority’s (PSA) grains production report if it is to buy more palay from farmers to store up for the impending dry spell.
As of Oct. 19, 2023, rice procured by the NFA from farmers has reached 506,000 bags of palay mostly bought from Region 6, where harvest is at its peak.
The agency expects to procure more palay in the coming two weeks as the harvest is expected to peak in several other rice producing regions like Region 1, to hit its target of 12.8 million bags for the year.
Nationwide, buffer stocking in the wet cropping season has contributed to a national supply nearing 90 days.
The agency noted that even traders are taking advantage of good market prices by buying local rice.
Currently, the procurement mandate of NFA is limited to 9 days-worth. However, it expects the President to increase its buffer stocking authority.
“As of now the mandate of NFA is limited to calamity relief. We keep a 9-day buffer stock but the President is pushing for a 30-day buffer stock to ensure enough supply during the lean season and in times of calamities,” Bioco said.
Seeing this as a window to expand the mandate of NFA, Bioco said he is pushing for the modernization and digitization of NFA facilities to improve its storage capacity.
Right now, its drying capacity is at 3 percent only which makes it imperative for the agency to seek funds to retrofit existing facilities and invest in new and modern mechanical dryers as well as silos.
“With the facilities we can buy more from farmers, dry the commodities ourselves and store them in best quality, and make sure this is available in nine to 15 months in palay form and six months as milled rice,” Bioco said.
From 2023 to 2024, the agency will be putting up large drying projects in six locations with a combined cost of about P1.1 billion.
“We hope to get an additional budget for dryers. We need to invest as much as P16 billion to P20 billion a year on drying and storage facilities to meet our mandate in the next four or five years. It takes time to build these facilities,” Bioco added.
Earlier this week, the Indian Embassy in Manila said India is giving its highest allocation of exports of non-basmati white rice to the Philippines.
In a statement, the Embassy of India in Philippines said that India’s Ministry of Commerce and Industry has effectively lifted its ban on overseas shipments of non-basmati white rice it imposed in July by allocating certain volumes to some countries, which includes the Philippines —one of the top importers of the staple grain.
“It is with immense pleasure to inform you that the highest allocation of rice export was made to the Philippines,” the embassy said.
“Request made at the leadership level and the positive decision reflects the growing confidence in the bilateral relationship,” the statement added.
The embassy said India is supplying the Philippines with 295,000 metric tons of non-basmati white rice, which is the highest allocation among the other countries that New Delhi has approved for export.