Enough rice stocks

MANILA, Philippines - We wish to correct the impression that the National Food Authority should maintain a total of 90 days rice supply as part of the government policy on food security as averred by Mr. Alex Magno in his column First Person entitled Unintended published in The Philippine STAR last August 21, 2010.

During his State of the Nation Address, President Benigno S. Aquino III said that there is an over supply of rice in possession of NFA. This is correct because NFA has stocks equivalent to 56 days rice supply or 26 days more than the mandatory 30-day buffer stock during that period.

May we inform you that as part of the outcome of the Food Security Summit during the Legislative and Executive Development Advisory Council Meeting held on February 14, 1996, it was decided that the National Food Authority should establish and maintain a strategic rice reserve enough for at least 15 days requirement to be held at any given time. Based on the present daily total consumption requirement (TCR) of 36,300 metric tons, the NFA therefore should have 544,500 metric tons of rice in its warehouses at any given time or 10.89 million bags of rice.

In the same meeting, it was decided that the NFA should also have at least 30-day buffer stock by July 1 of each year as the country enters the traditional lean months which end in September. This is the period when farmers are in the midst of farm preparation and palay production is very nil.

Please take note that aside from the NFA, the grains traders also maintain their own volume of rice which is termed as commercial stock. In the same manner, the farmers normally keep part of their produce and sell only the marketable surplus. The stocks in the possession of farmers and the general consumers are collectively counted as household stocks. These three classifications of stocks compose the total inventory of the rice industry before the lean production months start and altogether should be equivalent to 90 days.

The NFA monitors the commercial stocks in the hands of the private sector including rice traders and millers through market surveys conducted by the agency’s field offices and the submission of their stock position on a monthly basis. Meanwhile, the Bureau of Agricultural Statistics (BAS) monitors the volume of household stocks through their own surveys.

We deeply appreciate Mr. Magno’s concern on the rice industry and we hope our reply merits space in your prestigious newspaper.