NFA: Raising palay support price now could encourage smuggling

While the world market price of rice is low, National Food Authority (NFA) Administrator Angelito Banayo said raising the support price of palay now “could encourage smuggling” and keeps him from recommending the price hike to the NFA Council.   Rice in the world market is at about $541.1 per metric ton (MT), according to the latest commodity prices monitoring report of the International Monetary Fund. Back in 2009, rice was at $589.4 per MT.    "As vice-chairman of the NFA council, I will not recommend the increase to P20 per kilo…While we sympathize with rice farmers, it is difficult for us to increase the support price, " Banayo said.   The agency’s legal counsel Atty. Gilbert Lauengco said the NFA is already buying at a loss. "(NFA) loses about P9 per kilo when we buy at P17 per kilo. If you increase the support price to P20, we would lose about P14 a kilo.”   NFA is also selling the rice they have at P25 per kilo, losing P9 per kilo as the ideal price amounts to P34 per kilo, including transporation and milling costs.   Earlier, militant groups called on the Aquino government to increase the support price for palay so they can cope with the rising cost of production.   To help farmers, Banayo said the NFA is considering an incentive for farmers who will provide good quality rice to the agency. — ELR, GMA News