MANILA—The National Food Authority (NFA) has assured consumers of stable price and supply of rice until the middle of 2011.

The NFA’s lowest-priced “commercial” rice is P 27 per kilogram after the government imposed a P2 per kilo hike since December 7.

Guilbert Lauengco, NFA special assistant to Administrator Angelito T. Banayo, said the wholesale price of NFA rice is from P 23.50 to P 25.00 per kilo. The grain is being retailed from P 27.00 to P 32.00 per kilogram.

The price hike is among the measures undertaken by the government to ensure the viability of the agency and continue fulfilling its mandate of supporting farmers to produce enough rice, said Lauengco.

Lauengco said the price hike is aimed to protect the government’s palay (unmilled rice) procurement fund.

He said the agency is ready to flood the market with government-procured rice to discourage unscrupulous traders from jacking up commercial prices.

“Prices of commercial rice follow the law of supply and demand. If some traders jack up their prices, we will flood the market with lower-priced rice and they will find themselves selling at a loss,” Lauengco said.

He said that when government procures palay from farmers at P 17 per kilo, it should be selling the milled rice at P 32 to P 34 per kilo in the market.

Lauengco said the government initially sold the milled rice at P 23.50 per kilo, then at P 25 per kilo.

“At our buying price of palay at P17 per kilo, there is a big gap between our subsidized prices of P 23.50, P 25, and the P 32 to P 34 that our milled rice should have fetched in the market,” he added.