By Danilo P. Padua, PhD
smuggling.”
The perceived anomalous sale of NFA rice is still a burning issue. It should be.
The National Food Authority sold 150,000 bags of rice stored in its bodegas, described as deteriorating and aging, without consulting the NFA Council. The selling price was a bargain at PhP25.00/kg.
Compare that with the current market price of about PhP70.00/kg. The lucky buyers, 2 private rice trading companies, obviously will make a little windfall. The lucky buyers were two private rice trading companies who distributed most of the commodity in Mindanao, Visayas, and Bicol regions at a bloated price maybe of PhP60.00/kg-more than 100% of the buying price.
But what’s wrong with that? At least, the stored rice will not rot and be lost, according to Roderico Bioco, the NFA Administrator. Good point.
What is blatantly wrong though is the fact that the deal did not pass through the NFA council, there was no bidding, and the price was so low. And many more reasons why it is not in order. Bioco of course, defended the sale saying that he, being the administrator, is allowed to make the deal without the consent of the Council. This is hogwash?
If the amount involved is PhP93.75million, which was the pegged price approved by Bioco, that is huge per accounting and auditing concerns in the government. Thus, it necessitates the action and approval of the governing council of the agency. The explanation by the administrator that it was a distress selling does not hold any water. It is immaterial to the Council being bypassed.
Distress selling connotes that the rice in question is about to be destroyed or be declared as no longer fit for consumption. That is far from the truth as the buffer stock was not in the bodega for more than one year. That means, it is still in its good eating quality grade. Unless of course, storage conditions are very bad, which they are not.
It was ascertained that there was a collusion between analytical laboratory officials of the NFA and other high ranking officials of the agency, to show that the rice stock in question have already low quality, allowing them to price it very disadvantageous to the government
It is no wonder that the Ombudsman suspended 139 NFA officials earlier this month, including the administrator, for their involvement in the fiasco. The suspension was for 6 months. For good reason, no one from the different NFA offices in Northern Luzon, including the CAR, was among those suspended.
The number of the suspended officials was reduced though when about 25 of them were cleared by the Ombudsman of any unlawful involvement last Mar 14.
What is disconcerting is that, the DSWD was asking NFA to sell to them around 100,000 bags for their relief operations last August or September, 2023. The agency was spurned, it was not as lucky as the two favored trading firms. It has to buy from the open market the needed supply of rice at a high price. For its part, the province of Isabela was also requesting to buy 50,000 bags from the agency last year. Well, they were given, but only 20,000 bags were made available to them.
To think that the LGUs are actually subsidizing by about 2 pesos/kg of the buying price of rice. Anyway one looks at the rice price deal, it was actually distressful and disadvantageous to the government. That deal alone cost the government PhP112.0 M loss of income, according to experts.
As usual, the congressmen and senators are dipping their fingers into the NFA rice fiasco. I think this is in order. This is the type of situation that they should investigate, not like that of Pastor A. Quiboloy, whose case should rightfully belong to the legal courts.
My concern is that, if investigations will be done, will the result be used to craft a new law to prevent similar cases to happen again in the future. I would like to be positive but my hunch is that, it will amount to nothing. The issue will just be milked for all its media worth for the politicians, then it will rest in peace. Oh yes, election is so near already-next year.
But maybe, am immediately changing my tune now, something will be done in relation to the Rice Tarrification Law or R.A.11203 which was enacted in 2019. That law clothed NFA of the duty to buy 1. palay only from local farmers; 2. stabilize rice prices for the Filipino consumers; and 3. ensure sufficient buffer stock for calamities.
Numbers 2 and 3 seem to be conveniently overlooked. In addition, the law was crafted to fight inflation since, according to experts, the local supply of rice is the main mover of our inflation. The law was intended supposed to be to contain inflation, intending to reduce rice price by PhP 2-7/kg. The price of rice now is higher than the kites of the kids in the open field. Where is the law now?
And looking at the inflation in 2021-2023, the rate of our inflation was more than 4.0% with a very high of more than 9% in 2022, the presidential election year. The target was to limit the inflation to only 2-4%. Again where is the law? The law failed miserably.
For another thing, that law allowed the private sector to freely import rice, even removing the import licensing and regulatory function of NFA. The result was increased rice smuggling.
Considering also that the price of rice is about twice that of Thailand and thrice that of Vietnam, it is hoped that the Rice Tariffication Law should be amended or revoked. The present NFA Rice fiasco could be a springboard for lower rice price locally, but more profit for the farmers? Your bet is as good as mine.**
