Friday, 27 February 2009

Philippines allows private firms, farmers to import rice

Amy R. Remo
Philippine Daily Inquirer
http://business.inquirer.net/money/topstories/view/20090227-191297/Private-firms-farmers-may-import-rice

The government has allowed local private companies and farmer organizations to import as much as 300,000 metric tons of rice this year to help build up the country’s inventory, Agriculture Secretary Arthur Yap said.

The government opened this window to prospective importers two weeks ago and the 300,000 metric tons would form part of the 1.8 million metric tons of rice imports programmed for this year, Yap told reporters.

Last month, the government signed a contract with Vietnam for supply of 1.5 million metric tons of rice.

The government has opted for a government-to-government negotiation, instead of the usual tenders held by the grains agency National Food Authority (NFA), to prevent another rice price crisis like last year’s, which was blamed partly on the holding of auctions for big volumes.

Yap said prospective importers would have to find their own sources, set their own prices, and pay a minimal service fee to the NFA.

He said the 50 percent tariff on rice imports would be waived because all importations would be covered by the tax expenditure subsidy of the NFA, and the NFA would be the importer on record.

Last year, rice traders and farmer organizations were lukewarm to the idea of buying rice abroad, importing only 71,000 metric tons, out of the 300,000 allowed.

Yap said that in case the private sector could not import the full allowed volume this year, the government would import the remainder. “That’s why we’re doing it early, we’re giving them a chance right now to begin importing,” he said.

The NFA is tasked to maintain a 15-day rice stockpile at any given time and a 30-day buffer stock during lean months. With editing by INQUIRER.net

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