NextGen Day

The National Food Authority (NFA)’s buffer stock of rice should be increased, President Ferdinand R. Marcos Jr. urged on Friday. This was in response to estimates that the nation’s rice supply would run out by year’s end, leaving only 45 days’ worth for consumption.

The government should increase the nation’s rice stockpile from a combination of native and import sources, according to a statement from Rep. Joey Salceda of Albay’s 2nd District.

To prevent the NFA’s purchase program, which adds a 2- to 3-peso premium to farmgate prices, from accelerating inflation, he cautioned that imports should be restricted to the lean months of July and August.

“Being ready is always a good idea when El Nio is there. It may be a good idea to increase our buffer supply now that rice prices are genuinely falling across the board, Salceda remarked. Anyhow, we can always utilize extra stock for preparations for and recovery from disasters.

He noted that from February to March 2023, the price of rice fell by 3.2% globally, and by July or August 2023, he anticipates that pricing levels will be quite similar to those before to the epidemic.

“The trend indicates considerable price drops as global fertilizer markets improve their response to the currently sluggish Ukrainian scenario. The NFA can also launch a highly-targeted buying program to sustain prices in particular areas if a downward trend in rice prices has an impact on local farmgate prices, though I don’t believe it will be by much, Salceda said.

Salceda, though, emphasized that the private sector could contribute to the effort and that it shouldn’t be up to the government to import the entire predicted shortfall in rice inventories for the remainder of the year.

Because of tariffication and how simple it is to challenge, rice commerce has shown to be relatively tougher to cartelize than onions or other commodities that require substantial cold-storage capital. Therefore, I believe that the markets will adapt and react more effectively than the NFA. Let the private sector handle it for the time being, he advised.

In a video interview on Thursday, Marcos stated that for the time being, the NFA should increase its buffer stocks from local farmers.

Marcos added that although the government would still have to take importation into account, the amount of rice permitted to enter the nation has drastically decreased.

“Dahil masyado ng mababa, kami magpa-plano kung kailangan mag-import, kung kailangan magpahaba, magparami ng buffer stock sa NFA. The NFA buffer stock is the issue that is currently being faced. (Because the stock of NFA is so low, we are scheduling when to import and when to buffer the stock. The lack of NFA buffer stock is the only issue we can identify, he said.

To fill a projected gap in the nation’s buffer stock for the relief efforts of various agencies in the case of disasters this year, the NFA is recommending the purchase of 330,000 MT of rice.

According to agricultural experts, the proposed buffer stock of rice will provide enough for calamity and relief needs from July to December this year and is equivalent to nine days’ worth of national consumption starting in July 2023.

By July 2023, the NFA anticipates that its buffer inventories will fall to less than 500,000 sacks, or less than a day’s worth of public use, due to budgetary restrictions.

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