Nagging questions regarding the rice shipment in Subic

Customs Commissioner Ruffy Biazon excluded for possible distribution to flood victims some 21 million kilos (420,000 bags) of “smuggled Indian rice” in conformity with the Senate’s freeze order and pending appeals from the shipper’s representatives.

Some nagging concerns about the shipment, valued at P480 million, need to be addressed:

1. It took nearly four months from its April 4 arrival before the shipment reached media’s attention. Rice arrivals of lesser quantities were announced in the past.

2. There is a prescribed number of days for the vessel to notify parties to nominate/confirm the discharging port. Presumably, port authorities   gave the go-signal for the berthing slot before April 4.

3. The shipment was originally for Indonesia, but the vessel was denied entry there in the absence of a permit. Instead it sailed for Subic—about a week’s sailing time. Meanwhile, negotiations for a buyer in the United Arab Emirates were sealed, but deemed pending on account of the actions of the Bureau of Customs (BOC). As the description of the seized rice remains unknown—presumably the staple is basmati rice, not 5-15 percent white rice brokens (a variety favored by Indonesia) or the 25-percent rice grade procured by the National Food Authority (NFA).

4. The shipment and its arrival coincided with the period when the NFA Rice Council was finalizing the bidding for the private sector’s privilege to import 380,000 MT for 2012, distributed in March accordingly: 190,000 MT for cooperatives, 190,000 MT for traders. The notice to proceed was out April-May for the June arrivals.

A Philippine representative was tasked to “find local buyers.” It could have taken only two legitimate rice traders (10,000 MT each) to absorb the 21,000-ton shipment stored in Subic—duty free. Apparently there were no takers for unknown reasons as yet. The NFA could not have possibly considered the shipment, as it has opted to purchase 120,000 MT on a G to G (government to government) scheme.

5. The shipment was suspected to be of “bad quality.” Memories of the Philippine International Trading Corporation’s 638,269 MT rice importation for the NFA worth P10 billion from India linger. In 2003, legislators exposed the shipment to be “either rotten or infested with insects.” On Jan. 21, 2003, the Technology Resource Development Department (TRDD) was tasked to inspect 300 bags for reprocessing, and the samples were “powdery and with objectionable odor.” The TRDD recommended polishing prior to sale, in lieu of direct sale through market determined price. The NFA spent $2.5 million for repolishing.

Government should decide on the “smuggling” case without further delay. A similar shipment of 260,000 bags worth P200 million was seized at the Port of Subic in October 2002 by the BOC, but it was found to be rotting in Subic warehouses due to court injunctions on its disposal.

Release the cargo to the shippers, or distribute it to Filipino flood victims promptly.

—MANUEL Q. BONDAD,  

[email protected]