NFA does away with re-bagging sacks of procured palay

The National Food Authority (NFA) on Thursday announced it was beginning the pilot test of its plan to do away with re-bagging sacks of palay or unhusked rice it procures from local farmers to save on costs.

At a press briefing in Quezon City, NFA acting Administrator Larry Lacson said the grains agency will now accept palay bagged by farmers in their own sacks, provided it is new or in good condition if secondhand or reused.

As early as June, the NFA chief announced that the grains agency is doing a study on no longer re-bagging clean and dry palay it buys for its buffer stocking mandate.

Lacson said the initiative could result in millions of pesos worth of savings for the NFA, which it could then tap to buy more palay for buffer-stocking while boosting farmers' incomes.

The NFA chief said the pilot testing of the measure would involve around 20% of its target 6.4 million 50-kilo bags of palay it plans to procure for the wet season.

"At 20% of 6.4 million bags of procurement target during the main cropping season, NFA will save around P27.4 million in the fourth quarter alone in terms of the cost of new sacks and warehouse handling," Lacson said.

If the pilot testing succeeds, Lacson said, the NFA will bring up the percentage of palay it buys, which uses farmers' own sacks, to a maximum of 90%.

"At 90% of procurement target of 10.9 million bags of palay next year, we could save around P215.5 million, an amount the NFA could use to buy an additional 7,700 metric tons of palay at an average price of P28 a kilo," Lacson said.

The NFA chief explained the initiative to do away with rebagging was arrived at following its series of consultations with farmers nationwide.

Lacson said there was a clamor among farmers to do away with re-bagging when they sell their palay to the NFA as it would save them time as well as some handling costs.

Under the Rice Tariffication Law, the NFA is tasked with maintaining a national rice buffer stock equivalent to at least nine days of consumption, which now stands at 330,000 metric tons, to cover requirements in times of disasters and other calamities.

The law does not allow NFA to import or trade rice. It also requires it to source its buffer stock from local rice farmers. — VDV, GMA Integrated News