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DA open to antitrust review of fertilizer bidding; insists procurement is above board

The Department of Agriculture (DA) on Thursday expressed openness to let its controversial bidding of P1.8-billion of fertilizers undergo an antitrust review.

“The DA will cooperate with the PCC (Philippine Competition Commission), if it decides to investigate winning fertilizer bidders,” Agriculture Assistant Secretary and spokesperson Noel Reyes said in a virtual press briefing.

The Agriculture department was hit by allegations of “overpricing” its procurement of 1,811,090 bags of urea fertilizers for P1.8 billion in a series of biddings— equivalent to an average of P1,000 per bag.

Farmers from Tarlac and Nueva Ecija have alleged that the fertilizers distributed by DA under its stimulus program Ahon Lahat, Pagkaing Sapat Kontra COVID-19 were overpriced since the average retail price of urea fertilizer was only at P850 per bag.

The DA has since denied the allegations, saying that the procurement process of fertilizers were corruption-free and actually cheaper compared to national averages.

The DA conducted a series of bidding that attracted fertilizer manufacturers and distributors in the country, starting on April 29. It has issued the notices of award to the two winning fertilizer companies namely:

  • La Filipina Uy Congo Corporation for the delivery of 97,615 bags at P990/bag to Region 4A; 694,904 bags at P995/bag to Region 6, and 911,073 bags at P995/bag to Region 3, on May 8, 2020 and May 14, 2020, respectively
  • Atlas Fertilizer for the delivery of 107,498 bags at P900/bag to Region 7 on May 14, 2020.

“The DA welcomes initiatives by the PCC to investigate the matter, cautioning and probably sanctioning players found 'cornering' the supply of urea fertilizers,” Reyes said.

“All we want is to encourage other players to join, thus maintaining the spirit of healthy and level competition,” he said.

In a separate statement, the DA maintained that the centralized bidding of fertilizers is “aboveboard and transparent.”

It also said that its decision to shift from regional bidding to centralized bidding has favorably influenced the retail prices of urea fertilizers to go down to less than P1,000 per 50-kilogram bag.

Data from the Philippine Statistics Authority (PSA) showed the average price of urea is at P1,139 per bag in June 2019.

"The downward trend of prices of urea shows that we are on the right track in centralizing the bidding process, thus providing our farmers nationwide with affordable and reasonably-priced fertilizers," Agriculture Secretary William Dar said.

The urea fertilizers will be given free to farmers participating under the DA's Rice Resiliency Project (RRP) under a "buy two, take two" scheme for those who use certified inbred seeds and "buy two, take three" for hybrid users, according to Dar.

For transparency, the DA noted that the bidding process is live-streamed via its official Facebook page.

The Agriculture chief said they have completed the procurement of the first batch of fertilizers under the Rice Resiliency Project, strictly following the procurement modality of negotiated procurement or emergency purchase, pursuant to Section 53.2 of Republic Act No. 9184 and Government Procurement Policy Board (GPPB) NPM 003-2020 protocol under the “Bayanihan to Heal as One Act” and the GPPB resolution.

The P1,000 per 50 kilograms approved budget for contract (ABC) was pegged after consultation with various players in the fertilizer industry, and recommendation of the DA's Fertilizer and Pesticide Authority (FPA) based on a four-month price monitoring trend, Dar said, citing the DA’s Bids and Awards Committee (BAC) Secretariat.—AOL, GMA News