Better options to privatizing NFA functions

/ 12:10 AM October 06, 2016

As representatives of local rice farmers, we strongly oppose proposals to privatize the marketing function of the National Food Authority as well as its functions to maintain food security and stabilize rice prices and supply.

The presence of NFA buying stations in localities significantly influences palay prices, increasing them as government buys palay at higher prices. Privatization would remove NFA from the picture and eventually lead to a monopoly on palay trading by the profiteering private sector.


Our government’s economic managers must realize the simple fact that, without NFA, small rice farmers like us face trading losses, and there will be no reason for us to continue farming. Should this happen, where would our country source its staple food?

Rice importation is certainly not the answer as it would never guarantee food security; when the volatilities in the world market’s price and supply cause stock insufficiency or prohibitive prices, there results a rice crisis, as what happened in the country in 1995, 2008 and 2013.


Its mounting debts are used to justify NFA’s privatization.  But records show that NFA’s ill-advised financial policies were advocated by past officials, specifically the bank borrowings which have reached P7 billion in annual interest payments alone.

To further illustrate the enormity of these payments, P7 billion would be enough to buy around 8.3 million bags of palay in a year or the equivalent of 5.6 million bags of rice (at P1,250/bag), a volume that would meet NFA’s target 90-day buffer stock, which is enough to feed 104 million Filipinos for more than a week.

The NFA in its present structure should, therefore, be strengthened so that rice prices will continue to be subsidized, the livelihood of rice farmers stabilized, and quality rice made accessible to poor families in our country, which comprise 40 percent of our population.

While we are very supportive of President Duterte’s rice-self-sufficiency program, we also appeal to him to strengthen the NFA’s price and supply stabilization function, end the practice of bank borrowings and instead allocate direct funding from the President’s budget, and condone the interest and other charges on NFA’s loans with Landbank and other government banks and institutions.

We also appeal to the President to immediately rehabilitate irrigation facilities, reforest watersheds, stop the conversion of agricultural lands, subsidize fertilizer and certified seeds to palay farmers, and purchase typhoon-damaged palay at reasonable prices.

ERWIN Y. PARALUMAN, chair, Philippine Farmer’s Advisory Board, and president, Gensan Seed Cooperative, [email protected]

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TAGS: farmers, food security, National Food Authority, rice, Rice Importation, rice price
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