NFA: P95 M saved in Viet rice deal

MANILA, Philippines - The National Food Authority (NFA) has clarified that contrary to reports, not a single centavo was lost but it instead managed to save some P95.45 million from the 205,700 metric tons (MT) of rice that it imported from Vietnam last April.

According to the NFA, reports that some P457 million was lost from government coffers as a result of the transaction were malicious and pure lies.

In a statement, NFA deputy administrator Ludovico Jarina raised the possibility that some groups directly affected by the reforms being initiated by Agriculture Secretary Proceso Alcala and NFA Administrator Orlan Calayag could be behind the smear campaign.

Jarina said a wrong formula was used to make it appear that the $459.75 per MT that the NFA bought from Vietnam’s Southern Food Corp. II was overpriced.

On the contrary, Jarina said the freight on board (FOB) price of $365 per MT that the NFA entered into was way lower than the FOB reference price of $376.28 or P15,480 per MT that critics suggested.

As a result, he said the NFA managed to save P95.45 million because its buying price was lower by $11.28 or P462.48 per MT than what critics wanted based on P41.14-$1 exchange rate.

Jarina also belied claims that the NFA purchased an additional 18,700 MT of rice under the government–to-government agreement, noting that the move was authorized under the so-called 10 percent MOLSO (more or less at supplier’s option) provision.

Being the seller, he said Vietnam exercised the option and opted to sell an additional 10 percent to the NFA or an equivalent of 18,700 MT that was subsequently approved by the NFA Council under Resolution No. 682-2013.

Jarina said the move also got the green light from the Fiscal Incentives Review Board (FIRB) under the tax expenditure subsidy (TES).

He added that the Bureau of Customs would not have allowed the shipment to leave the port had it not been properly settled under the TES.