DA still keen to restore NFA regulatory, import powers to drive down rice price

The Department of Agriculture (DA) remains keen on reinstating the regulatory functions of the National Food Authority (NFA), including allowing it to dominate the market anew to lower rice prices—a contentious provision excluded from the newly signed amendment to the Rice Tariffication Law (RTL).

Republic Act 12078, the measure modifying the RTL that was signed into law by President Ferdinand Marcos Jr. last week, modifies the RTL by increasing the annual allocation for the Rice Competitiveness Enhancement Fund (RCEF) from P10 billion to P30 billion.

The amended law also extends the RCEF's duration, initially set to expire this year, for another six years, or until 2031. However, it rules out the House of Representatives' recommendation to authorize the NFA to sell its buffer stocks in the market again.

Agriculture Secretary Francisco Tiu Laurel Jr. stated that restoring some of the NFA's crucial powers, including the House's proposal, would aid the government in its long pursuit to bring down the cost of rice, which currently ranged from P50 to P60 per kilo.

"Back then, the NFA was allowed to sell its supplies in the market, but now it's not. It was also allowed to sell it to the LGU (local government units) so that it could also sell at a lower price [but] now, it's not possible either. Previously, the NFA could import to address [rice] shortage. Now, it can't. So, restoring [such mandates of the NFA would make a significant difference," Laurel told reporters in Filipino at the sidelines of the House probe into the high cost of basic commodities on Wednesday.

According to the DA chief, reviving NFA's regulatory functions would also empower the agency to revoke licenses to operate unscrupulous rice traders who are non-compliant and non-registered, among others.

NFA rice, once sold at P27 per kilo, was pulled from markets following the enactment of RTL in February 2019 during the Duterte administration.

The law prohibits NFA from directly selling its stocks in the market and restricts its function to buffering stocks of palay for calamities.

The RTL also abolished NFA's powers to regulate the rice sector, license market players, inspect warehouses, track stock movements, and stabilize prices, while liberalizing the importation of rice.

The House maintains that allowing the NFA to reenter the domestic rice market again would increase competition with commercial traders and drive down prices.

However, Senator Cynthia Villar, chairperson of the Senate Committee on Food and Agriculture, had vehemently opposed the House's proposal, citing previous corruption scandals involving NFA rice importation.

Under the amended RTL, NFA's selling of its buffer stocks will be limited to Kadiwa ng Pangulo centers, primarily located in areas facing rice shortages with drastically high prices.

At present, the cost of rice ranges from P50 to P60 kilo, a far cry from Marcos' target of P20 per kilo.

House lawmakers are highly suspicious that the persistently high prices of the staple grain—despite reports of excess rice supply and the enforcement of Executive Order 62 in July, which reduced the tariff on rice imports from 35 percent to 15 percent—may be artificial or manipulated by cartels.