NFA denies alleged overpricing of imported rice

MANILA, Philippines - The National Food Authority (NFA) said yesterday the alleged overpricing of rice imported from Vietnam last April was unfounded because of misunderstanding in the computation of importation expenses.

Responding to the allegations, the NFA said the importation process was carefully guarded to make sure that it would not be used as a “cover up for private unauthorized importation.”

“We constituted a government-to-government committee to handle negotiations and thereafter established an oversight committee to supervise the importation,” said the NFA in a statement yesterday.

A certain Ang Gawad Pinoy Consumers Cooperative alleged that the importation fee paid by the NFA to Vietnam Southern Food Corporation for 187,000 metric tons (MT) of rice buffer stock requirement for this year was overpriced at $459.75 per MT against the prevailing price of $360 per MT to $365 per MT.

Vietnam, through its state-run agency beat Thailand’s bid for $568 per MT.

The NFA explained that the $365 was the prevailing Freight on Board (FOB) price while the $459.75 paid per metric ton includes cargo insurance, freight charges, delivery fee, duties unpaid and warehouse fees for the delivery of rice to NFA warehouses located in areas where there is traditionally a rice deficit.

“It should be noted that the final acceptance for quantity and quality for CIF, DDU is in the warehouse while in FOB, it is at the loadport,” said the NFA.

In a related development, Agriculture Secretary Proceso Alcala said claims by several rice traders that the prices of commercial rice may increase is unfounded because of the approaching main harvest season.

There are some groups who want to sow confusion so that prices of commercial rice will rise,” Alcala said.

Alcala said there are millers burdened by oversupply in their warehouses who want to dispose of their stocks in good prices.

“Two months ago, there is plenty of supply in mills because of good harvest,” said Alcala referring to the June harvest. “There was also the problem of smuggling, but we have coordinated with the Bureau of Customs on this.”

The NFA counters increase in rice prices through direct palay procurement and infusion to areas where there is traditional supply deficit like Metro Manila which does not produce rice.