[MANILA] The Philippines, one of the world's biggest rice buyers, is studying a proposal to purchase 1 million tonnes more rice to keep an adequate buffer stock and prevent a spike in local prices, a senior government official said on Tuesday.
The Southeast Asian country has suffered crop losses in recent months due to below normal rainfall and is set to miss its 2015 target for rice, the national staple, because of a stronger and prolonged El Nino dry weather phenomenon that is potentially one of worst in 65 years.
The government has bought 500,000 tonnes rice for delivery in the first quarter for its 2016 needs. But another purchase of 1 million tonnes would ensure a 45-day buffer stock kept by the state grain agency National Food Authority (NFA) is maintained throughout the dry season, Economic Planning Secretary Arsenio Balisacan, told reporters.
The proposal for additional rice imports still needs to be approved by the inter-agency NFA Council, said Balisacan, who is also a member of the council. "Based on our analysis of the current data, we may need to increase, to import another one million tonnes to maintain a 45-day buffer stock," said Balisacan, adding the proposal will be discussed with President Benigno Aquino this week. "Adequate supply and the timely importation is crucial because what we want to avoid is domestic prices shooting up while world prices are relatively stable. We want to make sure that supply is there when we need it the most." The Philippines last month split a 750,000-tonne rice supply contract between Vietnam and Thailand as it sought to boost shrinking stocks.
The government is assuming a 25 per cent drop in rice output due to the impact of the dry spell, the same magnitude recorded in the 1997-1998 El Nino weather disturbance, Balisacan said.
The NFA has approved imports for delivery this year reaching nearly 1.8 million tonnes, including 937,000 tonnes already shipped in by the state grain agency and purchases by private traders totalling 600,000 tonnes. The Southeast Asian country last year purchased about 1.7 million tonnes of rice.