Govt spends P8.6B on rice subsidies in first half

MANILA, Philippines - The national government, through the National Food Authority (NFA), spent P8.6 billion from January to June this year to subsidize rice, an official statement on Tuesday quoted Agriculture Secretary Arthur C. Yap as having said in a forum at the University of Asia and the Pacific (UA&P) last week. The statement from the Agriculture department said Mr. Yap told participants in that forum that his department has distributed nearly 14.8 million bags of state-subsidized rice this year. NFA Spokesman Rex C. Estoperez, in a separate interview Tuesday, explained that the P8.6 billion "represents the direct loss of NFA, considering only the basic costexcluding miscellaneous and incidental expenses like storage cost." Mr. Yap said the NFA rice stocks, as well as other basic commodities, were distributed and sold through 3,197 Bigasan ni Gloria sa Palengke, 8,080 Tindahan Natin outlets, 540 Bigasan sa Parokya, and 199 rolling stores nationwide. The department, he added, also has 108 Barangay Bagsakan or drop-off points — 36 in Metro Manila and 72 elsewhere in the country — and 30 Bagsakan Centers that provide affordable basic food items to about 504,350 poor households. Mr. Yap noted that to ensure that the P18.25-per-kilo subsidized rice do reach poor consumers, the government has set up additional 1,399 new Tindahan Natin outlets. Along with the P18.25/kg rice, the NFA has also been selling better-quality rice priced at P25/kg and P35/kg in a bid to drive down prices of premium and fancy commercial varieties, he said. To date, the NFA has contracted a total of 2.3 million metric tons (MMT) of rice imports. The Agriculture secretary said 1.4 MMT of which are already in the country, while the balance of 900,000 tons will be delivered on or before September 30. A total of 1.7 MMT were contracted through five public tenders held by the NFA since December last year, while 600,000 MT had been contracted from Vietnam under a government-to-government deal. Mr. Yap pointed out during the UA&P conference that a confluence of events has contributed to the sudden global spikes of grains and other basic food staples. These are the hike in crude oil prices, which has likewise increased the cost of petrochemical-based fertilizers, which make up 30% of total food production cost, as well as the cost of transporting foodstuff from farms to urban markets; heat waves, drought, and excessive rains, which have damaged crops across the globe; and the rush in certain countries to produce biofuels, which has led to the reduction in size of lands devoted to corn, sugarcane and other food crops used as biofuel feedstock. — A. J. A. Catipay, BusinessWorld