As one of the government agencies with the most crucial impact, real or psychological, on national life, the National Food Administration (NFA) should take extra care in declaring anything that implies threat to rice supply and price stability in the country.
Unless a real, nationwide supply crisis warrants an urgent need for additional import of the grain, the NFA administrator must not make any public statement that might be misconstrued to mean rice supply in the country is, indeed, running out in two days.
Senators and the NFA Council had a valid reason to reprimand NFA Administrator Jason Aquino for making a panic-causing public statement at the Senate hearing on Tuesday, warning again of a severe rice shortage.
Aquino said at the hearing that as of that day, February 27, the country’s buffer stock had fallen to an equivalent of only 1.7 days, way below the required 15-day buffer stock at any given time.
Let it be made clear:
First, rice administered by the NFA accounts for only a small portion of the total supply of rice in the whole country. Total supply comes from three sectors, namely: household, commercial, and the NFA. Household stocks cover farming and non-farming households nationwide, while commercial stocks are sourced to registered grains businessmen. NFA is mandated to source its supply to local farmers, and may only import additional supply if warranted by the circumstances.
In December last year, the NFA accounted for only 5.5 percent of the total rice stock inventory. About 57.43 percent came from households, and 37.07 percent from commercial warehouses.
In January this year, the share of NFA rice to the total inventory fell to 4.67 percent.
So even if there was a big drop in the supply of NFA rice, the whole country is not likely to suffer a crisis-level shortage.
Second, if it is true that NFA’s buffer rice stock has gone down to 1.7 days, then Aquino has failed to serve the agency’s mandate. According to that mandate, “the government, through the National Food Authority, shall, whenever necessary, engage in the procurement of palay (paddy rice) from farmer-producers at such floor or support prices as it may be determined, for the purpose of stabilizing the price of palay or of maintaining a desirable buffer stock level.” That includes maintaining a buffer of 15 days at any given time.
Aquino’s explanation at Tuesday’s Senate hearing – that farmers were unwilling to sell their palay at the supposed price of P17 per kilo but demanded a higher price of P21 – met immediate rebuttal from Senator Cynthia Villar, head of the Senate committee on agriculture and food.
“Senator [Loren] Legarda always says that in Antique, the farm gate price is P8 per kilo. [Agriculture] Secretary [Emmanuel] Pinol says it is P10 to P12,” Villar told Aquino, then challenged him. “Don’t limit yourself to Central and Northern Luzon because the NFA has facilities in 87 provinces.”
Pinol corroborated Villar’s point, saying the reported shortage in NFA stock is being used “to justify the increase in the price of rice in the market” and the “additional importation of rice.”
The NFA Council already issued earlier this month an authority to import 250,000 metric tons of rice because of the supposed shortage, and Pinol sees no need to import more, pointing out that the country had a record harvest of 19.4 million metric tons last year.
The Agriculture secretary’s comment cast further doubt on the actions and intentions of the NFA chief. One would really wonder, why would Aquino take moves that he must have known would raise the consumer prices of the staple and subsequently create pressure to allow his agency to import more grains?
The answer to that question was summed up aptly by Villar in a radio interview on Wednesday: It’s either Aquino is so corrupt or he’s incompetent.
Either way, the NFA administrator is not fit to continue holding that job. He should heed Palace spokesman Harry Roque’s statement on Wednesday that NFA officials should quit government service if they are having difficulty fulfilling their mandate.