ANILA, Philippines - The National Food Authority (NFA) has procured 962,655 bags of rice as of the third week of March, down from 1.2 million bags in the same period last year, due to the impact of El Nino on the country’s crop production. The grains agency bought 489,114 bags of palay (paddy rice) in January, 339,543 bags in February, and 133,998 bags by the third week of March. The agency is targeting to buy 696,900 bags in April, the peak of summer harvest. NFA administrator Jessup Navarro said that despite the present tight supply of the commodity, the agency continues buying actively to increase competition with traders, resulting in a seller's market, which benefits the farmers.

 Farm level price of palay currently averages P16.82 per kilo. It was P16.07 per kilo last year.

The NFA, meanwhile, buys clean and dry palay at P17.70 per kilogram, inclusive of drying, transport and cooperative development incentives. The grant of these incentives brings the agency’s effective palay buying price to P885 per 50-kilogram bag.

According to Navarro, aside from enjoying a high ex-farm price for their produce, farmers at present have the option to either immediately sell their produce or to wait for the price to appreciate further.

Also, farmers who planted their crop early were spared from the ill effects of El Nino, and produced clean and dry palay that could command higher price while incurring minimal expenses.

The NFA is buying at a daily average rate of 8,960 bags.

Southern Tagalog posted the highest volume of palay procured with 458,570 bags, most of these coming from Occidental Mindoro.

Procurement was also high in the Ilocos Region with 167,893, and Bicol, with 151,133 bags.

The NFA has set this year’s palay procurement target at 11.7 million bags.