Market-based system in rice trading urged within ASEAN

Countries in the Southeast Asian region should undertake a regional effort to address the worsening rice crisis, former National Food Authority (NFA) administrator Anthony Abad told The STAR.

“There should be a regional effort to shift the rice sector to a market-based system,” he said.

Abad said that the different governments in the region should get out of the “rice business” and leave this to the traders.

“It should be de-politicized,” he said.

Abad conceded, however, that it would be difficult to reform NFA as this needs to go through Congress.

The state grains agency, which is mandated to sell rice at a cheaper price, is now in dire need of funds because of the current rice crisis the Philippines is facing.

The Finance department estimates that the losses of the NFA will reach P43.1 billion this year if the price of rice shoots further above $1,000 per metric ton.

Last year, NFA incurred losses of P1.27 billion because of its mandate to sell rice at a cheaper price. In 2006, it incurred losses of P10 billion.

The agency’s debts, meanwhile, have reached P52 billion.

The state-owned Land Bank of the Philippines has already extended P12 billion to the NFA to help the agency cope with the current rice crisis.