NFA buys 2.93 million bags of palay from local farmers

Workers unload sacks of imported rice from Vietnam to the warehouse of the National Food Authority (NFA). CDN file photo

The National Food Authority (NFA) is on track to exceed its goal for buying locally grown palay (unhusked rice) for the first half of this year after increasing purchase prices.

On Friday, the NFA announced it had procured 2.93 million bags of palay, achieving 97 percent of its target of 3.08 million bags for the first semester.

The food agency attributed the substantial increase in palay procurement to the higher buying price approved by the NFA Council in April.

The NFA Council previously raised the procurement prices, which range from P23 per kilogram to P30 per kg for clean and dry palay. In September last year, the range was from P19 to P23 per kg.

The buying prices for fresh and wet also climbed to P17 per kg to P23 per kg from the previous P16 per kg to P19 per kg.

“Farmers in several provinces in northern Luzon have yet to complete their harvest and they’ve appealed to the NFA to continue with our procurement,” NFA acting administrator Larry Lacson said.

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Before implementing the new price scheme, the NFA said it had bought only 142,244 bags of palay as private traders jacked up their offer-price to secure rice supply amid the El Niño phenomenon.

“We are pleased that the NFA Council’s decision has resulted in a significant increase in our rice buffer stock, especially with the onset of the typhoon season,” Agriculture Secretary Francisco Tiu Laurel Jr. said.

Tiu Laurel said the NFA has put up a “fast lane” to accommodate farmers who sell no more than 50 bags of palay.

The NFA also ordered its personnel to start milling stocks to meet the Department of Social Welfare and Development’s target of 500,000 bags of rice as the agency’s existing warehouses can no longer store new batches of palay.

Exceeding targets

“Our problem now, and it is a pleasant one, is that we are running out of space in our warehouses, especially in [Cagayan Valley],” Lacson said.

Despite exceeding targets, Lacson said the NFA has only spent half of the P9-billion procurement budget for this year in purchasing the additional 2.8-million bags of rice in the last six weeks.

The NFA has P8-billion surplus from last year’s procurement spending to buy more rice stocks.

Under the Rice Tariffication Law, the NFA should maintain a national rice buffer stock equivalent to at least nine days of consumption. It is pegged at 330,000 MT and should be sourced solely from local palay producers.

Buffer stocks kept in NFA warehouses are meant to aid the government’s efforts in case of disasters and other calamities.

The DA has been pushing for the law’s extension to beef up the rice fund for farmers currently set at P10 billion and reclaim the NFA’s capacity to influence retail prices of rice.

Wanting to build up the national rice buffer stock and upgrade storage capacity, the NFA had sought a budget of P16.3 billion in 2025.