NFA buying binge boosts palay reserves by over 6,000%
The National Food Authority’s (NFA) aggressive palay-buying spree has led to a 6,045-percent increase in its inventory for the first quarter as it focused on solely purchasing local farmers’ produce to fill the government’s buffer stocks.
In a statement released to the press, NFA acting administrator Tomas Escarez said the agency’s total palay procurement reached 53,851 metric tons (MT) in the first three months, significantly higher than the 875 MT it was able to buy in the same period last year.
Milling recovery is usually 65 percent, which means the first quarter inventory would result in 35,000 MT of rice. Filipinos’ daily consumption is usually 32,000 MT.
Escarez said the higher incentives approved by its policy-making body encouraged more farmers to sell their produce to the NFA, even as the farm-gate price for palay had been on a decline since January.
Industry stakeholders said the downtrend in prices was due, in large part, to expectations of more supplies coming in on the heels of the passage of the Rice Import Liberalization Law, which would open the market to more imported rice.
“We are not surprised because March is the start of the summer crop harvest and we were able to capitalize on our higher incentives versus the low buying price of palay traders,” Escarez said. “While traders reduced their buying price to as low as P14 a kilogram, we on the other hand increased our buying price up to P20.70 a kilo for clean and dry palay.”
Based on NFA data, highest palay procurements were recorded in the provinces of Isabela (6,504 MT), Nueva Ecija (5,492 MT), Tarlac (5,448 MT), Occidental Mindoro (4,662 MT), and North Cotabato (4,481 MT).
In line with this, NFA decided to double its palay procurement target this year to 616,450 MT from 331,721 MT. Escarez said the NFA was ready to buy more local produce, especially in the next two months as summer harvest peaks.
