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By Angelo S. Samonte, Reporter
THE government will seek new ways to buy rice
amid tightening world supply after its May 5 tender for the grain
failed, Agriculture Secretary Arthur Yap said on Tuesday.
Yap also revealed that the Department of
Agriculture will be forging partnerships with local officials to
boost local rice production. At the Asian regional headquarters of
the Food and Agriculture Organization of the United Nations, the
formation of a rice-exporting cartel was sharply criticized.
He said the government had authorized
“alternative modes of procurement” in dealing with foreign
government suppliers of the staple food.
Manila could negotiate directly with a foreign
rice supplier instead of using a tender, since suppliers do not want
to negotiate under an open public tender because it tends to shore
up prices.
The tender of National Food Authority (NFA) for
675,000 tons failed on Monday because “foreign suppliers would
only want to supply rice in such a way that it will not drive up
prices of rice.”
The government could buy grains without bidding
since it is allowed by the Republic Act 9184, the Government
Procurement Act, Yap said.
“If it is an executive agreement under Article
4 then that takes it out of the ambit of Republic Act [RA] 9184. If
there is a failure of bidding, you can do negotiated bidding under
Section 53. There are a lot of flexibilities under RA 9184.”
A government-to-government procurement could
bring down prices because the transaction information is not
released publicly.
“It’s possible because you have to
understand how world trade happens. When you publicly tender, the
winner is forced to procure as well because a lot of the suppliers
don’t really hold totally their own stocks. They would have to
turn to other suppliers,” Yap said.
That scenario is seen to drive up prices because
everything is disclosed.
But Yap admitted that it is hard to speculate
about pricing rice importations under a government-to-government
deal.
“It [rice price] could be higher, it could be
lower. But we have reason to believe that when transactions are made
at least outside the glare of big public tenders, there is every
reason to believe that prices can be negotiated [to] lower than
international prices.”
The NFA has secured 1.7 million tons of rice
shipments, mostly from Vietnam and Thailand, out of a projected
supply shortfall for the year of 2.7 million tons.
Yap said the government is anxious to build up
rice stocks because the so-called lean production months are
nearing. He clarified that the next tenders are intended to beef up
the NFA’s buffer stocks since the government was able to close the
10- percent gap in the domestic production of rice.
-- Ira Karen Apanay and Xinhua
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