The rice stock specified under the tender is 10-percent long grain white rice with 25-percent broken. This volume will serve as part of the Philippines’ buffer stock for the lean months of July to September and as contingency stocks during natural or man-made calamities, NFA Administrator Orlan A. Calayag said in a statement.
Asean member-countries with an existing memorandum of agreement for the supply of rice to the Philippine government were invited to submit their sealed offers and quotations, but only Thailand and Vietnam joined the tender held last April 3.
Thailand, through its Department of Foreign Trade, offered a price of $568 a metric ton with a minimum offered volume of 100,000 tons to a maximum of 187,000 tons. For its part, Vietnam Southern Food Corp. (Vinafood II) had a price offer of $459.75 a ton for the total maximum volume.
Vietnam’s offer was lower by $108.25 a ton and was even lower than the NFA’s 2012 rice import cost of $470.70 per metric ton, according to the agency.
Calayag said that under the cost insurance in freight-deliver duty unpaid (CIF-DDU) terms, rice would be delivered “on a door-to-door basis.” NFA said this would eliminate its exposure to losses due to shortlanding, spillage and demurrage. “With this setup, the NFA will be paying only for what is received and accepted at designated warehouses. Whatever losses incurred for shortlanded cargo, including bad order cargoes, will not be shouldered by the NFA,” the official said.
The Philippines was expected to reach food sufficiency after 2013 and would focus on further farm reforms to boost agribusiness and agritourism, according to Agriculture Secretary Proceso Alcala. This would not only create value-added output for the domestic economy but also make economic expansion more “inclusive” in the sense that farmers could earn beyond merely selling fresh produce, he said earlier during a roundtable discussion with the Inquirer.
The Department of Agriculture was anticipating a new record rice harvest this year of about 20 million tons from the current record output of 18.3 million tons for 2012, Alcala said.
The country is more than 90 percent self-sufficient in palay. Yet, since food sufficiency involves other farm products, Alcala said expansion was also expected from a range of subsectors from corn to coconut.
Among the reforms already underway is with the NFA, which is increasingly stocking up palay or rough rice (which can be stored for longer periods) rather than white or milled rice. It is also importing less, estimated at only 187,000 tons this year (for buffer stock) from the record 2.4 million tons in 2010. Rice imports are seen to decrease and the Philippines is even pushing exports of specialty rice.
Philippine agriculture comprised only about 12 percent of economic expansion (measured in terms of gross domestic product) last year though it is the biggest employer in the country.