The sales blitzes and gimmicks of the Department of Agriculture and National Food Authority failed to dispose of the “aging” 300,000 tons rice in nearly 100 Kadiwa ng Pangulo outlets at cheap prices sans purchase volume quota.
So, now a state of emergency for rice was slated for January 22 as recommended by the National Price Coordinating Council of the trade department.
The hype about reducing rice prices for NFA stocks through the Kadiwa flopped and now the DA wants an emergency to be declared to help NFA get rid of its buffer stocks.
In 2024 and in early 2025, the NFA incessantly complained of being unable to compete in palay procurement because of the higher prices and ready cash paid by traders at the farmgate leading to an increase of its palay procurement to P23 for clean and dry and P17 for fresh and wet.
Still, the farmers sold their palay to private traders, who paid in cash and picked up their produce, while NFA’s requirements were rigorous and payment processing was not instant time consuming.
The spike in rice prices began in late 2023 and peaked in 2024. So where did the NFA get the huge inventory of aging rice?… People see all these as marketing gimmicks to sanitize the image of those in power
A SALES TOOL?
The spike in rice prices began in late 2023 and peaked in 2024.
So where did the NFA get the huge inventory of aging rice?
Obviously, from importers– with some from confiscated stocks and others bought from legitimate importers for buffer stocking purposes.
This is the first time in the country’s history that an emergency is being invoked as a sales tool and to keep local retail prices at bay. During the administration of Ferdinand Marcos Sr., a real rice (supply) crisis happened but never was an emergency declared.
The current strategy of DA is not only flawed and myopic but it would have far-reaching dire consequences with no price reductions to be expected. At best, it would just be a ploy for politicians to give away rice for the midterm May elections.
The DA claims the stocks are nearly six months old and the NFA warehouses are filled to the brim worries NFA as it prepares for the coming dry season beginning February – to justify its billions of pesos of procurement funds, or it might not get the same, if not more, procurement budget for the coming years.
WAREHOUSES CONGESTED
Former Agriculture Secretary Leonardo Q. Montemayor, who now heads the Federation of Free Farmers, asked the NFA to disclose the real reason for the congestion of its warehouses.
Montemayor said the NFA has nationwide network of warehouses with total storage capacity of 1.2 million metric tons of palay or rice form.
“In what warehouses and locations are congestion happening?” Montemayor asked. “If, say, in Occidental Mindoro, why weren’t their stocks shipped out earlier to other areas within or outside Region 4-B?” Montemayor said as he recalled that from July to December 2024, the Philippines was hit by a series of destructive typhoons.
The FFF also warned that the DA only wants the NFA to be allowed to sell its buffer stocks to local government units in Metro Manila at a cheaper rate — supposedly to lower the retail price of rice and empty NFA warehouses just in time for the palay harvest season.
The DA wants to release the buffer stock to bring down prices and decongest NFA’s warehouses in preparation for the February harvest.
Since the Rice Tariffication Law bans the NFA from selling directly to the public, the stocks could be sold to local government units, the Armed Forces of the Philippines, the Philippine National Police, other government agencies and government-owned and -controlled corporations for as low as P36 a kilo next month, and by March, the selling price can decrease to P33.
This would not solve the root cause of high rice prices, profiteering, in which case the DA can only use the Anti-Agricultural Economic Sabotage Act of 2024 and charge and jail those hoarding, profiteering and operating as a cartel, instead of the psychologically-distorting emergency situation.
“Rice prices remain high because of importers, wholesalers and retailers who are taking advantage of the market. It’s like saying, okay, we will let the profiteers be. Let’s just do something else to bring down prices. Let’s sell NFA rice,” said FFF national manager Raul Montemayor, who also suggested that DA ask the help of the Department of Finance and the Bureau of Internal Revenue to investigate the profiteers.
He warned that selling NFA rice to local governments is prone to corruption and politicization (vote buying by seeking exemption from the election ban).
INEPT GOVERNMENT POLICIES
The steady elevation of rice prices is not just a rebuke of the government’s mandatory reduction in import tariff for rice —from 35 to 15 percent since June 2024 — it also showcases how inept government policies have become from production and marketing regulations for the staple.
It also shows that all the hype about Kadiwa operations have failed both consumers and producers because of the lack of vision, strategy and planning and their effective implementation.
People see all these as marketing gimmicks to sanitize the image of those in power.
“What we have is a failure of the government agencies to run after and discipline profiteering importers, wholesalers and retailers,” he pointed out.
