MANILA, Philippines — The National Food Authority (NFA) is preparing a large-scale auction of its aging rice and palay (unmilled rice) inventory. The move is designed to declutter government warehouses ahead of the peak harvest season, improve the agency’s cash flow, and prevent food waste through spoilage.
NFA Administrator Larry Lacson confirmed on Wednesday that the NFA Council has greenlit the sale of 232,141 metric tons (MT) of palay and 62,890 MT of milled rice. The disposal will be conducted in phases, prioritizing the oldest stocks currently in storage.
The disposal is a standard operational procedure governed by the Rice Tariffication Law, which dictates when the agency must rotate its stocks to ensure quality:
- The “3-and-6” Rule: The law allows the NFA to dispose of milled rice three months after processing and palay six months after it enters storage.
- Auction Timeline: A dedicated bidding round is scheduled for May, specifically targeting between 5,000 MT and 20,000 MT of milled rice that has been stored for a year or longer.
- Inventory Strategy: “We will prioritize the oldest stocks first and gradually move to newer ones,” Lacson explained, noting that this method ensures the national buffer remains fresh and edible.
While the final price points are still being determined using data from the Philippine Statistics Authority (PSA), officials indicated a likely floor price:
- Estimated Range: The floor price for the auction is expected to fall between ₱22 and ₱28 per kilogram.
- Purpose of Funds: The proceeds from these sales are typically reinvested into the agency’s palay procurement program, allowing the NFA to buy fresh grain directly from local farmers at competitive prices.
Clearing warehouse space is critical as the country enters a period of increased agricultural activity. By offloading aging stocks now, the NFA ensures it has the physical capacity to support local farmers by purchasing their new crops, thereby helping to stabilize local farmgate prices.
This inventory refresh comes at a vital time for the agricultural sector, which is currently receiving focused government attention—including a ₱10-billion cash assistance rollout—to mitigate the effects of rising production costs and global oil volatility. For the NFA, the upcoming auction is not just about clearing space, but about keeping the nation’s food reserves dynamic and reliable.