MANILA - The Philippines' grains agency increased its rice stocks by about 14 percent in the first half of 2013, buying aggressively from local farmers to keep prices stable and avoid further imports if crops are damaged in the coming typhoon season.
The National Food Authority (NFA), a state agency that buys and stockpiles rice, bought 5.6 million bags of local farmers' unmilled output from January to June 25, or about 280,000 tons, NFA data showed on Thursday. That was 44 percent above its target volume of 3.9 million bags for the period.
The purchases took the agency's rice inventory to 13.66 million bags, about 683,000 tons, as of June 25, enough to cover 21 days of local consumption, the NFA said.
Ample rice supply in the Southeast Asian country, which enjoyed generally good weather in the first half, has helped keep prices down and inflation at manageable levels. The June headline figure is seen below the central bank's 3-5 percent target band for the year.
The Philippines was the world's biggest rice buyer in 2010 with record purchases totalling 2.45 million tons, when storms devastated crops.
This year, it decided to buy up to 350,000 tons, including 187,000 tons bought from Vietnam in a government-to-government deal. It imported 500,000 tons last year and 860,000 tons in 2011.
To encourage farmers to plant more, the NFA is targeting a 70 percent increase in its local rice purchases this year to about 616,000 tons.
Rice prices have fallen since last year due to thin demand from major rice buyers, including the Philippines, and bulging stocks in top producers such as Thailand, Vietnam and India.
The typhoon season usually begins in May or June in the Philippines, which aims to produce a record 20 million tons of unmilled rice this year, up 11 percent from last year, to become self-sufficient in the grain. At least 19 cyclones hit the archipelago every year.