The National Food Authority expects more than half-a-billion pesos in additional sales revenue after the NFA Council chaired by Agriculture Secretary Francisco P. Tiu Laurel, Jr. approved last month an increase in the selling price of rice to the Department of Social Welfare and Development and other government agencies.
A member of the NFA Council, DSWD agreed to the price hike that will generate for the grains agency an additional revenue of P557.3 million for 2024.
“The higher selling price agreed to by the DSWD will help not only reduce NFA losses but also give it additional resources to buy more palay from our farmers,” Sec. Tiu Laurel said.
In 2023, NFA posted a net loss of P6.19 billion as it pursued its mandate to buy palay from local farmers to build a 9-day buffer stock of about 300,000 metric tons of rice.
NFA administrator Larry Lacson said the additional revenue will allow NFA to buy more palay from farmers that would boost the government corporation’s rice buffer and increase farmers’ income.
“At a buying price of P28 a kilo of palay the additional revenue from our sales to DSWD will allow us to buy an additional 400,000 50-kilo bags of palay. That’s easily 12,600 metric tons of incremental rice supply,” said Lacson. “We thank the DSWD for their understanding and support to this price adjustment,” he added.
Lacson assured that the price increase of P38 a kilo from P25 per kilo to the DSWD, other relief agencies and LGUs will not have an impact on the market price of the national food staple.
Earlier this year, the NFA Council approved a higher buying price range of P17-P30 a kilo from last year’s P16-P23 a kilo to allow the grains agency to compete with private traders who have driven prices higher due to El Niño and the lingering effect of India’s rice export ban. India has since lifted the ban.
The adjustment in its palay procurement price has allowed NFA to buy around 3.5 million, 50-kilo bags of palay at the end of the first half, after only only procuring less than 200,000 bags prior to the NFA Council decision in June.
For this wet season, NFA plans to buy between 6.4 million to 8.7 million bags of palay. It has sought from the Department of Budget and Management the immediate release of P9 billion of rice procurement funds, increasing its 2024 budget to around P11 billion. ### (DA-National Food Authority)
