The National Food Authority (NFA) needs to secure additional funding to cover the increase in the national rice buffer stock mandated under the amended Rice Tariffication Law.
NFA administrator Larry Lacson explained that a new provision in Republic Act 12078, signed into law by President Ferdinand Marcos Jr. last month, now requires the agency to maintain a buffer stock sufficient to cover 15 days of national consumption, up from the previous 9-day requirement. With national consumption averaging 37,000 metric tons of rice daily, the additional 6 days of reserve will require the NFA to procure approximately 300,000 metric tons of palay from local farmers at an estimated price of P23 per kilo.
“We were initially allocated a budget of P9 billion for buffer stocking this year, based on the 9-day requirement. But the additional 6 days will necessitate an extra P9 billion for palay procurement considering that our palay price procurement per kilo increased in 2024, Lacson said. Republic Act 12078 also earmarks for NFA rice procurement P2 billion from rice tariff in excess of the P30 billion allocated for the Rice Competitiveness Enhancement Fund.
The RCEF aims to modernize rice farming and support local farmers. Agriculture Secretary Francisco P. Tiu Laurel Jr., who is also chairman of the NFA Council, the highest policy making body of the grains agency, said the NFA’s palay procurement ideally accounts for 20 percent of the country’s domestic production—around 4 million metric tons—compared to the current rate of approximately 3-4 percent.
“The NFA used to be a market maker—both a buyer and seller of rice. Now it is restricted to buffer stocking and buying rice from local rice farmers. We aim to restore its influence on palay pricing by purchasing more local rice, helping to boost Filipino farmers profitability,” said Tiu Laurel.
In a separate development, the NFA Council approved on Tuesday a resolution that will enable the NFA to sell rice to local government units (LGUs) for disaster preparedness. Lacson noted that the NFA should ideally release around 25,000 metric tons of rice every month to LGUs without jeopardizing the buffer stock needed to respond to emergencies, calamities, or a national food emergency declaration aimed at stabilizing rice supply and prices.
