Rice supply still tight

The country’s nationwide rice inventory has remained tight, declining by 15.21 percent from last year, while rice prices in the local market continued their upward trend for 28 weeks now, government data showed.

The Philippine Statistics Authority (PSA) reported that the country’s rice inventory as of July was at 1.99 million metric tons (MT), lower than the 2.35 million MT registered in the same period last year. It was also 15.68-percent below the previous month’s rice inventory of 2.36 million MT.

Of the reported stocks, almost half or 49.85 percent were kept in the households sector at 992,000 MT, while 47.47 percent or about 945,000 MT were in commercial warehouses. The National Food Authority’s (NFA) share, meanwhile, was at 2.66 percent with 53,300 MT of rice in stock.

Following the Filipinos’ average daily consumption at 32,000 MT, the current inventory—excluding those in the households—could feed the country for 31 days. This is below the 60-day buffer stock target ordered by President Duterte.

Since January, retail prices of regular- and well-milled rice continued to go up following the tightness in the supply of NFA rice and the recorded decline in rice production caused by higher fuel prices.

As of the third week of July, PSA data showed regular- and well-milled rice were priced at an average of P41.27 and P44.98 a kilo, up by 8.89 percent and 7.27 percent from a year ago.

Meanwhile, the distribution of NFA rice variants—priced at P32 and P27 a kilo depending on the quality—remained minimal as shipment unloaders continued to struggle with the current weather conditions.

NFA spokesperson Rex Estoperez admitted that with the current distribution scheme of the agency, it would not be able to depress rice prices as anticipated months earlier.

“NFA cannot influence prices of rice in the market with our current distribution,” he said. “If we could distribute rice at a bigger volume to the market, we might. But we cannot do it with this kind of weather.”

As the agency awaits the arrival of more imported rice, it is expected to buy palay from local farmers to augment its stocks. But with the prevailing buying price for palay at P21.55 a kilo versus NFA’s buying price at P17 a kilo, Estoperez admitted the agency was having difficulty keeping up.

For this year, NFA is targeting to procure 2.6 million MT of palay. As of this month, it has bought only 3 percent of its target or 79,858 MT.

The grains agency continued to lobby for an increase in its palay buying price.