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THE Department of Agriculture (DA) is again asking lawmakers to put back some of the regulatory powers of its attached agency, the National Food Authority (NFA), including the authority to directly sell rice to the public, to help control market prices.

"We need to restore some of NFA's powers to help it manage the country's rice situation more effectively," said Agriculture Secretary Fran-cisco Tiu Laurel Jr., concurrently chairman of the policymaking NFA Council.

"The House version of the revised Rice Tariffication Law (RTL) offered that chance, but unfortunately, the Senate Committee on Agriculture rejected it," he pointed out.

In 2019, Republic Act 11203, or the Rice Liberalization Act, replaced the country's quantitative restrictions on rice imports with a tariff-based system. The government believed this would make the rice market more competitive and lower the staple's prices.

The law also gave rice traders full control over rice imports and stripped the NFA of its power to sell rice at cheap prices.

Tariffs collected from imports were to be plowed back into local agriculture, supporting modernization and innovation.

In December 2024, President Ferdinand Marcos Jr. revised the law, extending the Rice Competitiveness Enhancement Fund, or the Rice Fund, until 2031 and tripling the government's support for farmers, from P10 billion to P30 billion.

However, rice prices remained high, prompting the declaration of a food security emergency in early February 2025, while global rice prices dropped and tariffs were reduced.

The NFA has been having difficulty in disposing of the buffer stock in its warehouses, which are said to be holding over 7.7 million 50-kilogram (kg) bags, enough for 10 days of national consumption. It needs to clear out its warehouses which will be used to store palay (un-milled rice), which it buys from farmers.

On May 1, the DA rolled out its P20-per-kg sale of rice to help the NFA reduce its buffer stock and in fulfillment of Marcos' campaign prom-ise, but the Commission on Elections ordered its deferment until after the May 12 elections.

Just a buffer-stocking agency

Tiu Laurel reasoned that the RTL has hindered the NFA's efforts to optimize financial resources, which could have been allocated to increase rice procurement and strategic market interventions benefiting farmers and consumers.

Prior to the law and its amendment, Tiu Laurel said the NFA could import rice to augment supply and intervene when prices surged. He pointed out that now the NFA is just a buffer-stocking agency, limited to buying rice from local farmers for emergency use.

NFA Administrator Larry Lacson added that, even under the amended RTL, the agency may only dispose of rice stocks through auction when the rice is aging (two to three months post-milling), during a declared food security emergency, or in the event of a calamity or emergency. Failed auctions risk spoilage of aging stocks.

He explained that, in palay form, aging takes twice as long at six months, and that aging palay needs to be milled immediately.

"Following the first-in, first-out system, it can theoretically take a minimum of nine months from palay purchase before an auction could happen," Lacson said. "That means inferior quality stocks and higher cost due to stock maintenance to keep it from insect infestation. Allowing NFA to directly release stocks to the market ensures better quality rice at more affordable prices."

The NFA was reportedly in debt after selling rice at subsidized retail prices. It slashed its net loss by 38 percent in 2021 from a year earlier to P9.6 billion under the RTL, according to the Department of Finance.

Source : msn