MANILA, Philippines – The National Food Authority (NFA) rejected yesterday offers for the supply of 100,000 metric tons (MT) of rice as all offersboth initial and revised were above the reference price during yesterday’s tender.
The NFA Council is expected to decide todaybased on the provisions of the terms of reference of the tenderif the lowest offer for the day of $416.85 per metric ton (MT) by Vietnam Southern Food Corp. (Vinafood 2) against the reference price of $408.14 per MT may be considered for award.
“We are deferring the decision. Because under the terms of reference, the mechanism is that we should reject the offers (if these are above the reference price) but the second sentence says the revised offers will be evaluated based on the lowest price.We are referring the matter to the NFA council for their decision,” said lawyer Patricia Galang de Jesus, executive assistant to the NFA administrator.
NFA bids and awards committee chairman Joseph de la Cruz said another option for the council is to order a fresh tender using a new reference price.
He said there is no precedent to considering the lowest revised offer and the agency may be questioned by the state auditors.
“There is no basis. We can be subject to question by the Commission on Audit,” he said.
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All initial offers from the governments of Thailand (represented by the Department of Foreign Trade), Vietnam (Vinafood2) and Cambodia (Green Trade Company/Cambodia Rice Federation) were way above the reference price with offers of $418 per MT, $417 per MT and $459.50 respectively.
Thailand declined to make another offer.
“The price is too low, it is even lower than the last (reference) price,” said Malou de Leon, marketing officer of the commercial affairs of the Royal Thai Embassy.
Cambodia and Vietnam then revised their offers to $455.50 per MT and $416.85 per MT respectively.
De la Cruz said the three countries likely placed high offers because they have other markets or buyers that are willing to buy at higher prices.
China, for instance, is keen on importing around two million MT, an attractive supply destination for major rice exporters.
The 100,000 MT of rice should be imported by August to boost the NFA’s buffer stock for the lean season.
The government was able to procure only about 150,000 MT out of the 250,000 MT programmed rice importation for buffer stocking in the second half of the year.
De la Cruz said domestic stocks are still abundant as traders and millers have large inventories at hand.
The government, however, has to pursue with the importation of the remaining volume under the programmed importation to secure buffer stock in the event of calamities to be able to respond to relief requirements.
The NFA, said de la Cruz, maintains a stockpile sufficient for 24 days equivalent to 750,000 MT. The state grains procurement agency is mandated to maintain a buffer stock sufficient for 30 days.