Gov’t buying 300,000 MT of corn from local farmers
Secretary Arthur Yap of the Department of Agriculture (DA) has said that the government is now implementing its plan to buy at least 300,000 metric tons (MT) of yellow corn from domestic growers at the new, higher support price of P13 a kilo this main season to encourage farmers to plant more of this crop, which is a main component of livestock feeds.
Yap said the National Food Authority (NFA) has set aside funds amounting to P3.9_billion to bankroll this massive corn buying program.
President Arroyo last month approved an increase in the NFA’s buying price to P13 per kilo of yellow corn last month—from the previous rate of P11.50—to help farmers cope with spiraling production costs and close the demand-supply gap for the grain.
This rate adjustment will be the second in seven months as the government already increased the per-kilo support price from P10 to P11.50 in November last year.
“The government is priming itself to buy 300,000 MT of yellow corn in the coming main harvest,” Yap said. “This plan was already approved by the President and the Cabinet.”
Yap said this new support price of P13 per kilo for yellow corn nationwide, which pegs it at the same rate as white corn, will provide farmers the flexibility to sell their corn in different parts of the country through the NFA’s electronic trading system.
Under this electronic system, Yap said a corn farmer in Bukidnon can command a price of P13 a kilo using the new support price of the NFA for yellow corn, to sell his produce to a feed miller in Bulacan. The Bukidnon farmer can deposit his corn at the NFA warehouse in the province and the feed miller in Bulacan can pick up the stocks he bought from him at the NFA warehouse in Bulacan.
Yap said this could be the precursor of a futures exchange system, which will help ensure quality and stabilize prices of grains in the country.
Corn farmers have welcomed the increase in the crop’s support price, saying the move will encourage them to increase production and allow the sector to attain its production target this year, following a 2% growth decline in the first quarter.