What NFA does not tell about its imported rice

Manuel Bondoc’s well-written letter (“Rice statistics tell all,” Inquirer, 8/9/11) deserves some attention. However, as a National Food Authority (NFA) insider for more than 20 years, may I add some interesting facts about rice importation and local palay production.

Bondoc correctly pointed out that NFA imported rice from 2008 to mid-2010 at P270 more for every P1,000 that other countries paid for the same quality, but for a reason different from what he told readers. Of course, NFA’s old timers, including now-Rep. Arthur C. Yap, would say that the price obtained at that time went through a transparent international bidding. What they don’t tell media is, a significant portion of those rice importations has 5-percent “brokens” (grain that has broken into two or more pieces during milling) and 15-percent brokens, and the bulk has 25-percent brokens (the last being the one sold to the ultimate consumers through accredited rice retailers nationwide). This is the reason it appears that the cost of rice importation is higher than it should be: the price of imported rice with only 5-percent and 15-percent brokens is being lumped with the bulk of imported rice with 25-percent brokens.

The good quality rice (with 5-15 percent brokens) are stored in NFA warehouses for at least more than a year before the NFA disposes them together with the old stocks of 25-percent brokens, by selling them at market determined prices (SMDP). I believe this is the single biggest reason NFA incurred huge losses in the past decade – without benefiting the consuming public.

Also, while accredited NFA retailers can buy NFA rice at P25/kg, they are authorized to sell it at P27/kg only; more than that, they are penalized. On the other hand, rice sold in thousands of bags through big-time rice traders via SMDP, say, at P18-22/kg may be sold to consumers at, say, P28-32/kg without fear of any penalty. So, poor consumers are not really benefited, while big-time rice traders and their cohorts inside and outside NFA are enriched.

I wonder why the media, NGOs and the NFAEA are silent on this issue of good quality rice (with only 5-percent and 15-percent brokens) being imported only to be stored at the NFA warehouses for more than a year as buffer stocks (NFA can also use the cheaper rice with 25-percent brokens as buffer stocks, can’t it?) and “sold SMDP” to big-time rice traders.

As to rice sufficiency, while statistics support the assertion of Bondoc, I really doubt it considering that President Aquino’s State of the Nation Address did not even mention any large scale irrigation project or the meaningful rehabilitation of existing but silted irrigation systems; and considering the magnitude and long gestation period of such undertakings.

The reason we are importing less this year is very obvious: We still have stocks of NFA rice from previous importations, which NFA is frantically selling via SMDP. The presence of cheap smuggled rice in the public market also helps lessen NFA rice importation.

I hope I am wrong and Bondoc is right.

—JOSE B. TAGANAHAN,

regional engineer,

NFA Region 10,

Cagayan de Oro City