Subsidizing rice in emergency to cost gov't P2.25 B

Losses of up to P2.25 billion will be absorbed by the government due to the sale of subsidized rice in the market during the state of food security emergency, but officials maintained the measure is necessary to influence prevailing retail prices that have remained exorbitant.

- Jasper Emmanuel Arcalas

Aging rice stocks of the National Food Authority (NFA) would be sold to local government units (LGUs), Kadiwa centers and other state entities at P33 per kilo, the Department of Agriculture (DA) said.

Partner LGUs are expected to sell rice to constituents at a suggested retail price of P35 per kilo.

The amount would be enough to cover logistics costs, Tiu Laurel said.

The NFA is estimated to lose between P1.8 billion and P2.25 billion in six months for selling 150,000 metric tons of rice, as the approved selling price is P12 to P15 per kilo lower than its break-even cost.

Possible sanctions against LGUs that would sell rice above P35 per kilo will be outlined in guidelines that the government is still drafting.

Computation of the selling price accounted for costs incurred in palay procurement, milling and storing of grains, as well as a so-called social discount, according to Roy Untiveros, acting manager of the NFA's operations department.

Max SRP on imported rice lowered to P55/K