AGRINURTURE, Inc (ANI) announced on Monday that it had signed a $1-billion exclusive deal with Vietnam Southern Food Corp. (Vinafood II) to import 2 million metric tons (MT) of rice to the Philippines starting this year.
Vinafood II is a state-owned corporation designated by the government of Vietnam to export rice and help achieve food security in Southeast Asia.
The deal was granted an original proponent status last month. Under the joint venture agreement, it was proposed that the “consortium shall finance the supply of NFA rice with no cash out on the part of government.”
Both parties will jointly determine the origin, suppliers, delivery and arrival periods, packing and loading and discharging ports, while the NFA (National Food Authority) will determine the type of commodity to be imported, its specifications and quantity.
“As accepted by NFA, the ANI consortium will import as much as 500,000 metric tons of rice, equivalent to two weeks national inventory of subsidized NFA rice per quarter,” ANI said in a statement.
“Since NFA will not release a single peso for said purchases, the agency can use its budget to buy more palay from local farmers or import more rice as needed,” it added.
ANI has been engaged in rice importation and trading in the first quarter of 2015.
The NFA has been a subject of criticisms recently for failing to procure rice from local farmers, leading to a diminished supply of NFA rice in the market and the increased price of commercial rice.
According to NFA, instead of buying palay, it used its funds to pay maturing loans, which lawmakers said was a technical malversation of funds. — Reicelene Joy N. Ignacio