NFA revises rice import program for farmers

Bowing to pressure from farmers organizations (FOs), the National Food Authority (NFA) is revising its Farmers as Importers program (FAI).

NFA Administrator Arthur Yap said the state-run agency has agreed to accommodate the requests of FOs to encourage a more "equitable participation" in the FAI.

For one, the NFA will limit the import ceiling for each farmer group at 500 metric tons (MT) per quarter or lower, depending on the number of applicants for the program, but each party can bring in only up to a maximum of 1,000 MT per year.

The other enhancements to the FAI include the following:

• The first-come-first served system will be replaced by an allocation system to ensure maximum and equitable participation by all legitimate farmers groups. For the first quarter importation, applications of all groups will be accepted by the Land Bank of the Philippines (Landbank) up to Feb. 28.

• The FAI will also now allow other finance options for FOs using instruments such as documents against acceptance. However, the importers should file an import entry declaration with the Bureau of Customs (BOC), and deposit a corresponding amount with Landbank to cover the customs duties. These instruments should also be coursed through the Landbank.

• Advanced information on the importation must be furnished to the NFA, including such data as quantity and quality, price, origin, and expected arrival period.

Discharge ports for the shipments will be limited to Manila, the Manila International Container Port, Batangas, Cebu, and Cagayan de Oro.

The NFA this week held a dialogue with a number of FOs, namely the Provincial Farmers Advisory Council, the Confederation of Grains Retailers Associations, Federation of Free Farmers Cooperatives, Maguindanao Farmers Cooperative, the Regional Farmers Advisory Council, and the National Confederation of Irrigators Association.

In the meantime, the NFA has suspended the FAJ pending an investigation being conducted by the agency on alleged fake FOs that have acquired licenses to import rice.

NFA Deputy Administrator Gregorio Tan said the accreditation process was put on hold and all those that were earlier given licenses, particularly those that were reported to be dormant or non-rice-based FOs will be checked thoroughly.

The new set of rice importation guidelines is in response to the clamor of smaller FOs which have difficulty pooling their resources to be able to open letters of credit (LCs) for the current maximum allocation of 1,000 MT per FO.

Under the FAI, FOs and farmers cooperatives are allowed to import a total of 400,000 MT of rice which is half of the government’s projected import volume for this year of 800,000. Of the projected import volume, 150,000 MT will be imported in the first quarter and 250,000 MT will be imported in the second quarter.

Since the Landbank started processing LCs last month however, FOs have been complaining that the rules are too stiff for them to comply with since a 10,000 MT requires them to raise at least P170 million. Local government officials have stepped into the fray, saying that their constituents were shut out and could not get allocations because the Landbank stopped issuing LCs after the 150,000 MT was consumed. There are still about 105,000 MT of standby applications for LCs.