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Manila bidding out rice supply contracts

Publication Date : 04-04-2014

 

An initial five prospective bidders have signed up to be among the possible suppliers of a total of 800,000 metric tonnes of imported milled rice to the Philippines. The government has set aside a budget of 17.18 billion pesos (US395 million) for the supply contracts.

Additional interested parties can still avail themselves of bid documents as the process is open until the deadline for the submission of bids on April 15, according to the National Food Authority.

The roster of bidders is expected to lengthen in the runup to the deadline, considering that there were other groups that had sent their representatives to observe the pre-bidding conference held Thursday in Quezon City, according to Ludovico Jarina, who heads the bids and award committee.

Those who officially entered the bidding process on Thursday included the Jakarta Stock Exchange-listed LG International Corp. and Vietnam Southern Food Corp. or Vinafood 2 as well as the shipping unit of the French group Louie Dreyfus Co.

Thai Hua Co. Ltd., and Asia Golden Rice Co. Ltd.—both from Thailand—are also vying for contracts.

“There are other suppliers in the world market like those from India, Pakistan, Cambodia and Myanmar,” Jarina told reporters. “So we can expect more bidders before the closing on April 15.”

Based on the bidding terms, the total purchase volume is divided into four lots of 200,000 MT.

A bidder can offer a volume of as little as 100,000 MT, which means that up to two suppliers can win one lot.

Jarina said that on Thursday, the Vietnamese bidder bought documents for all four lots while the others are gunning for one or two lots.

He said the NFA decided to call for offers for four lots partly to attract more suppliers.

Any group can bid for all four lots if the bidder does not mind paying bid security that is equivalent to 2 percent of the cost of the entire 800,000 MT.

Asked how the importation would affect local farmers, Jarina said the incoming supply was meant to beef up and maintain the NFA’s buffer stock—not for immediate retail distribution, but only during the lean months.

Based on the bidding terms, the first lot should be delivered by May.

Following that, three subsequent equal tranches of 200,000 MT should each arrive one month after another.

Last March, Agriculture Undersecretary Dante S. Delima said the NFA Council was of the opinion that the country needs 800,000 MT to augment local production.

State “economic managers see this as crucial to stabilizing prices and (reining in) inflation,” Delima said.

For his part, Philippine Agriculture Secretary Proceso J. Alcala said the government was set to continue importing milled rice this year amid a renewed push for self-sufficiency.

Alcala said importation continued to be necessary considering that the government missed its goal of attaining self-sufficiency in rice production by 2013.

The agriculture chief said the release of large volumes from the NFA’s stockpile in the wake of Super Typhoon Yolanda had led to an “abnormal” situation where the bulk of available domestic supply was in the hands of the private sector.

 

 

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