PHL rice stocks fall to 5-month low

warehouse

Manila, Philippines – Philippine rice inventory as of February 1 fell to its lowest in five months due mainly to the depletion of the National Food Authority’s (NFA) stockpile, according to the latest data from the Philippine Statistics Authority (PSA).

Data from the PSA showed that the country’s rice stocks declined by nearly 22 percent to 1.795 million metric tons (MMT), from 2.296 MMT recorded in February 2017.

The rice inventory during the period was the lowest since September 2017, when it reached 1.422 MMT, PSA data showed. The PSA said the total rice inventory as of February 1 was sufficient for 53 days.

The NFA’s rice stockpile as of February 1 plunged to its lowest level in two decades. It also declined by 86.8 percent to 61,400 MT, from the previous year’s 465,260 MT. Data from the PSA showed that nearly 89 percent of the food agency’s buffer stock was comprised of imported rice.

“Year-on-year, rice stocks inventory level dropped in the households, commercial warehouses and NFA depositories by 5 percent, 5.74 percent and 86.8 percent, respectively,” the PSA said in its monthly report titled, “Rice and Corn Stocks Inventory,” published recently.

“With reference to the previous month’s rice stocks inventory level, a decrease of 17.93 percent was observed in the households, 24.58 percent in commercial warehouses and 42.54 percent in NFA depositories,” it added.

Of the total rice inventory as of February 1, about 60.58 percent were from households, 36 percent were held by commercial warehouses and 3.42 percent were in NFA depositories, according to the PSA.

The total volume of rice held by households during the period reached 1.087 MMT, while those in the commercial warehouses amounted to 646,560 MT.

The government periodically monitors rice inventory to determine whether it would need to import the staple to boost local stocks.

During the period, PSA data also showed that total corn-stock inventory stood at 410,300 MT, 6.65 percent lower than the last year’s record of 439,570 MT.

The corn-stock inventory as of February 1 declined by more than half from the 951,600 MT recorded in January.

The PSA said the bulk of corn-stock inventory in February, or 81.84 percent, was in commercial warehouses, while households accounted for 18.06 percent. NFA depositories accounted for a mere 0.10 percent.

Corn stocks in commercial warehouses amounted to 335,820 MT, 74,120 MT in households and 390 MT in NFA warehouses.

“Corn stocks both in the households and NFA depositories decreased in comparison to their levels in the previous year. Stocks dropped by 51.27 percent in the households and 83.56 percent in NFA depositories. However, an increase of 17.79 percent was recorded in commercial warehouses,” the report read.

“Compared with the previous month, corn-stocks inventory level in all sectors decreased. Stocks dropped by 1.16 percent in the households, 61.67 percent in commercial warehouses and 9.07 percent in NFA depositories,” it added.

The PSA sources its data for the rice inventory held by household from its monthly Palay and Corn Stocks Survey, which covers farming and nonfarming households  nationwide. The survey, which is done in the first four days of the month, covers all provinces except Batanes.

Meanwhile, the data on commercial stocks are sourced from registered grains businessmen through the Commercial Stocks Survey, conducted by the NFA, the results of which are submitted to PSA. NFA stocks are monitored from their warehouses/depositories, according to the PSA.

‘Aggressive palay buying’

To beef up its stockpile, the NFA said over the weekend that it is ready to compete with private traders for local palay during the summer crop harvest from March to May.

NFA Administrator Jason Aquino said in a statement that the food agency will focus all its logistics, funds and personnel on aggressive palay buying as harvest starts to peak in some areas.

As early as January, palay procurement funds had already been remitted to areas expected to start harvesting earlier than the others. These include Iloilo, Aklan, Bukidnon, La Union, Bulacan, Pampanga, Bataan, Batangas, San Jose and Mamburao in Mindoro Occidental, Sultan Kudarat, and other areas in Mindanao.

The agency attached to the Office of the President said it plans to deploy mobile procurement teams in far-flung areas to buy paddy directly from farmers. They are instructed to buy even freshly harvested or wet palay based on the respective drying capacities of each NFA provincial and regional office.

Almost all NFA provincial offices and half of its buying stations across the country have mechanical driers and solar drying facilities.

All NFA buying stations will also be opened and utilized during the whole harvest period. Procurement personnel shall be required to render overtime work if necessary, Aquino said.

“Historically when harvest peaks, ex-farm prices go down, though minimal, during the summer crop because this is the season when farmers produce better quality palay than during the wet crop so traders also buy aggressively,” Aquino said.

“Farm-gate prices may go down as rice from the private sector’s minimum access volume imports start to be released in the market. When that happens, the NFA shall seize the opportunity to also aggressively buy local harvest,” he added.

Aquino said the NFA has made it easier for famers to sell their palay to the agency by simplifying its procedures and payment scheme. In less risky areas, NFA will pay palay deliveries in cash on the same day.

NFA buys palay at P17 per kilogram (kg) clean and dry with an additional P0.20 per  kg drying incentive and P0.20-P0.50 per kilogram delivery incentive. For farmer organizations an additional P0.30 per kilogram  is given as cooperative development incentive fee. Effectively, the NFA said its palay buying price ranges from P17.70 per kg to P18.00 per kg.

During year-round Ugnayan meetings with farmers and local government officials, NFA reminds them that in selling palay to NFA, an individual farmer only needs to secure a passbook to prove that he is a legitimate farmer. The passbook is given free of charge.

Also, the NFA said a farmer needs to submit an information sheet with identification picture, and certification from the barangay captain, municipal agriculturist, municipal agrarian officer or national irrigation administration where his farm is located. For farmer organizations, a master passbook must be secured by submitting their certificate of registration, assembly resolution and master list of members.

But even without a passbook, a farmer can still sell his produce to the NFA up to 200 bags for the first time. Farmers may also deliver more than their marketable surplus provided there is a certification on the volume of their harvest from the municipal agriculture officer.

For 2018, NFA targets to buy 6 million bags of palay, equivalent to 300,000 MT, to boost the government’s buffer stock and rice distribution requirements.

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