Modernization to prevent sale of aging rice stocks

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The National Food Authority (NFA) said modernization measures which, among other things,  would improve the shelf life of rice, will help prevent the practice of selling old stocks of the grain.

The NFA said  the Department of Agriculture (DA) secured funding for a P93-billion modernization program involving the acquisition of mechanical dryers, silo storage, modern rice mills and warehouses with controlled climate system to handle 1.2 million metric tons of palay equivalent to a 15-day strategic rice reserve.

The agency made this statement after DA Secretary Francisco Tiu Laurel Jr. ordered an  investigation into allegations the NFA sold thousands of tons of rice to certain traders at a price disadvantageous to government.

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NFA said in a statement yesterday  “distress selling”   through bidding of rice stocks is done instead of  re-milling as this entails additional processing, logistics and recovery of loss costs to make the stocks acceptable to consumers.

“To avoid these costs, NFA can opt to sell at the highest mandated price to qualified commercial buyers on as-is where-is, no-selection and first-in first-out bases and first come-first serve basis, meaning the first buyer gets to buy the oldest stocks. In the future, when NFA has modernized, the distress selling could be avoided as the shelf life is longer and there is more time to allow the disposition of the stocks in best condition to the preferred purpose – calamity relief,” the agency said.

NFA added  the NFA Council allows the disposition of aging stocks up to 10 percent lower than the mandated price or a P22.50 per kg floor price up to the maximum mandated ceiling of P25 per kg and damaged stocks for at least P6.50 per kg.

“Meantime, NFA management has recommended to the NFA Council to increase the mandated maximum selling price of NFA rice. The current NFA management was able to responsibly dispose its rice stocks to government accounts by stretching to maximum shelf-life, minimizing the sale of residual volume to other accounts by implementing stricter guidelines and safeguards,” NFA said.

Tiu Laurel  earlier created a panel to look into allegations that certain NFA officials allegedly authorized the sale of milled rice stored in the agency’s warehouse for P25 per kg without bidding and after purchasing the grains in palay form at P23 per kg.

“We do not brush aside reports of impropriety against officials of the DA, regardless of the source. We also welcome any government agency who may wish to conduct their own probe to ferret out the truth,” said Tiu Laurel, in an earlier statement.  DA spokesperson Arnel De Mesa, told reporters yesterday the panel started the review of available documents and inquiries.

“There’s a lot of finger pointing, a lot of them accusing both those inside and outside the NFA. What the secretary wants is the truth so he himself initiated the conduct of a probe and he wants to learn what really happened,” De Mesa said. Jed Macapagal

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