ILOILO Governor Arthur Defensor Jr. is planning to roll out a zero interest loan program for farmer cooperatives to combat the low cost of palay brought about by the influx of imported rice due to the Rice Tariffication Law.
The loan will be offered to accredited cooperatives provided that the amount will be used to purchase palay at premium prices from small farmers tilling below one hectare of land.
"We have a program that is being planned, although this is premature to make an announcement," Defensor said.
He said the plan is not yet final since they are validating it with laws and regulations, stressing it involves loans, financial institutions, banking laws, cooperative laws and even Commission on Audit rules.
"In the past few days, I was validating the program because I want that we will give loans to the accredited cooperatives who are involved in the buying of palay with the agreement that the loan will act as capital to buy rice grains from the farmers who have 1 hectare and below at premium prices," he said.
The target farmers from which the cooperatives will buy rice grains are those who cannot customarily avail themselves of National Food Authority (NFA) prices.
"They are not farmers who can afford to bring their palay to the NFA. The moisture content of the plays of these farmers cannot pass the level of NFA. These are our target farmers," Defensor said.
Last Wednesday, September 11, Defensor met with accredited cooperatives and they agreed to have the loan offered.
The production cost of palay in Iloilo is currently around P10 to P12 per kilo.
There are 114,000 farmers in Iloilo Province, of which 7,953 have less than one hectare of production.
Last week, Defensor visited the markets in the province to check on the prices of rice.
"I visited the market and right there and then, I asked the establishments, because they are buying rice. I asked them about the plan (of buying palay at a premium price) and I got a good result," he said.
He added that the timeline for the loan agreement with cooperatives is end of September.
September is the start of palay harvest in Iloilo. (SunStar Philippines)