Gov't wants private traders to buy most of rice

MANILA, Philippines - The Philippines wants private rice traders to import most of an estimated 1 million tons the country needs of its national staple this year to help contain government costs, the head of the state grains agency said.

Angelito Banayo, administrator of the National Food Authority (NFA), said the government could set the volume of rice to be imported by the private sector this year later on Monday.

"Our estimate is that we will import not more than 1 million tons this year, and most of the purchases will be undertaken by the private sector," he said in a radio interview.

The total import volume is five times higher than the 200,000 tons the private sector bought last year, when the Philippines' purchases hit a record 2.45 million tons. The NFA bought more than 2.2 million tons last year, mostly from Vietnam.

The country, the world's biggest rice buyer in recent years, is targeting an increase in domestic unmilled rice output this year to a record 17.4 million tons.

Allowing the private sector to purchase rice could help ease the financial burden of the NFA, whose outstanding debts are estimated at about P177 billion ($4 billion), Banayo had said.

The NFA's debt load is one of the biggest drags on the total public sector's obligations, which cover the national government and state-owned firms.

The private sector's rice imports are tariff free, but the traders instead pay a service fee to the NFA. Agriculture Secretary Proceso Alcala said last week Manila may buy less than 1 million tons of rice this year, less than recommended by a government panel, given forecasts of a good first-quarter rice crop.

The NFA Council, chaired by Alcala, is scheduled to meet on Monday and could possibly firm up the country's buying plans this year, Banayo said.

Banayo said the Philippines could buy rice from Vietnam and Thailand, and possibly even from Cambodia this year.

"We could do it through government-to-government deals or we could also seek international tenders," he said. "The problem with tenders is that prices are usually much higher."

(Source: http://ping.fm/s83VZ)

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