DESPITE claims of the National Food Authority (NFA) that is has enough supply of rice, many consumers still cannot buy the 27 peso-per-kilo rice particularly in Metro Manila.
Media reports confirm the undeniable shortage of NFA rice supply in Metro Manila as authorized retailers reported that the regular supply volume from NFA has been reduced to half.
NFA has been harping on the “more than enough” supply of rice yet the reality on the ground shows otherwise.
In addition to the supply concern, the NFA is also being criticized for its “plan” of increasing the price of NFA rice from the current 27 peso-level to 35 to 38 pesos to address the financial losses of the agency.
Is the NFA mandated to earn profits for the government from the sale of rice?
From the usual 17 pesos per kilo buying rate, the NFA recently increased the rate to 20.70 pesos in its purchase of palay from local farmers. There is no problem about this because NFA exists to help, among others, our local farmers.
With such buying rate, NFA is said to breakeven, financially, at the 33 peso-selling price.
What’s puzzling is the treatment of the NFA to look at the performance of its mandate from the business breakeven point of view when it exists to do public service and not earn profits.
Instead of relating the higher breakeven point to a higher selling price of NFA rice, shouldn’t the NFA relate the former to the need for higher appropriations from the national budget to subsidize the 27 peso-per-kilo-price of NFA rice?
From the management point of view, the NFA should also look into ways of reducing its operational expenses to lower the 33 peso-breakeven-price.
Increasing the per-kilo price of NFA rice from the current 27 to 35 or 38 simply because the agency increased its buying price of palay is, at best, inconsistent with the true essence of its public service mandate.
The question that the NFA needs to answer is simple – will it be able to better serve the public with a higher price for NFA rice?
Given the problem on the shortage of NFA rice supply, NFA can better serve the public with better planning.
Given the perennial problem about the illegal conversion of NFA rice to commercial rice by some unscrupulous traders, NFA can better serve the public with more effective control measures.
If NFA really wants to be more “businesslike,” it should remember that even in business, increasing product prices does not always mean keeping the company afloat. It may also mean its demise.
