THE National Food Authority (NFA) has to stay despite the billions of “losses” it incurs in order to fulfill its mandate of ensuring food security.
NFA-Negros Occidental provincial manager Marianito Bejemino made the announcement, following the proposal of the new administration to abolish or reduce the agency to a regulatory body due to its accumulated debts.
Bejemino said to ensure farmers of ready market for their products in a profitable price, NFA has to incur losses.
“The losses are actually the cost of government’s social responsibility to also assure the consuming public of good quality yet affordable rice, stabilizing market prices, and ensuring available stocks during calamities and emergencies,” he added.
NFA Central Office records showed that as of August this year, the agency’s accumulated debt was trimmed down to P158.9 billion – from P165 billion before.
Bejemino said that NFA, on behalf of the national government, has to buy high from the farmers and sell low to the grains businessmen, including retailers.
The agency’s support price on palay is P17.40 per kilogram. From which, Bejemino said they are selling it for P25 per kilogram only, from the supposed P35, which translates to a profit of P2 per kilogram among retailers.
Another source of losses for the NFA is the expenses on rent for warehouses, security personnel, and conduct of pest control measures.
“These are needed to maintain good quality buffer stocks,” Bejemino said, stressing that these expenses are not added to the price of rice being sold by the agency.
He cited that the low distribution of NFA rice, like in Negros Occidental, could not be a substantial reason for the administration to abolish the agency.
NFA does not compete with commercial rice, but serves as an alternative, he said.
Moreover, the proposed reduction of the agency into a regulatory body, if not total abolition, is also unfavorable for the local agency officials and employees.
Under regulatory functions, NFA’s operation is only limited to market monitoring and regulation. It can no longer perform buffer stocking, which is part of the food security mandate.
“NFA has to stay even with a new name as long as its functions still focus on food security and social services,” Bejemino added.