The National Food Authority (NFA) said it will need P16.3 billion next year to procure the target volume of rice buffer stock and additional budget to upgrade storage capacity.
Larry Lacson, NFA acting administrator, said aside from funding procurement of palay from local farmers, the agency will also have to build additional storage and drying facilities to improve buffer stocking capacity.
NFA’s capacity to dry palay is only at 31,000 metric tons (MT) but it buys around 495,000 MT of palay in compliance with the law requiring it to maintain a buffer stock equivalent to about nine days of national rice consumption.
The Department of Agriculture’s (DA) proposed budget for next year sets aside P24.85 billion for the NFA, a 77 percent increase from P14.03 billion this year.
Of the budget for this year, P9 billion has been set aside for NFA’s palay procurement with an assumed procurement price at a maximum P23 per kg but the NFA Council raised the maximum purchasing price to P30 per kg last month to effectively compete with private traders for local rice supply.
The Rice Tariffication Law limited the role of the NFA to build a national buffer stock to ensure sufficient rice supply in case of emergency, procuring palay from local farmers.
Congress is hearing proposals to restore NFA’s power to import rice or stabilize prices in the market.
