July 15, 2003

HON. VICTOR AGUEDO E. AGBAYANI

Governor of Pangasinan
Urduja House, Capitol
Lingayen,Pangasinan

Dear Governor Agbayani:

In line with the government’s thrust to beef up Food Security in the country and in order
to uplift the living condition of farmers as well as to strengthen the cooperative
movement, we wish to inform you of the following flagship program of the agency we
are undertaking:

I. Grains Inventory Financing Technique (GIFT) Program

The GIFT for small farmers is a program which provide farmers’

organizations/cooperatives with a financing facility through a Trust Receipt
system to enable them to monetize their grain deliveires to NFA and still
remain owners of the stocks while waiting and looking for buyers at better
prices.

Farmers deposit stock in NFA warehouse and, using NFA issued Certificate of
Custodianship as collateral, secure bank loan equivalent to 80% of stock value
to meet immediate production and subsistence needs while waiting for better
prices.

II. Farmers Grains Exchange Program (FGEP)

The FGEP is a program of the NFA intended to provide farmers with the
opportunity to sell their produce at different consumption points in the country
where there is strong demand using the NFA’s exisiting processing, transport
and manpower resources. It also aims to assit farmers to become competitive
with established rice traders in marketing their produce.

Farmers can deposit their stock in NFA warehouses in production areas and
withdraw its rice equivalent from NFA warehouses in major consumption
centers for sale at better prices.
III. Farmer’s Incentive Rice (FAIR) Purchase Program

The Farmer’s Incentive Rice Purchase Program (FAIR) is an NFA

procurement incentive designed to encourage farmers to sell their harvest to
the agency. In turn, the farmer-seller will be entitled to buy from NFA up to
10% of the rice recovery from the palay stocks sold to the agency during the
previous year. The rice allocation is to be used by farmers for their own
consumption during the lean months when prices are relatively high.

IV. Farmer’s Option to Buy- Back (FOBB) Program

Farmers have the opportunity to buy back the same volume of palay stocks
sold to the agency within a period of six (6) months for resale to
traders/millers when palay prices are better than NFA’s support price.

V. Post-Harvest Facility Assitance Program

Farmers are given priority access to NFA’s storage, milling, drying, threshing,
transporting, and weighing facilities at reasonable service rates.

VI. Farm Level Grains Center III (FLGC III)

A 10,000-bag capacity warehouse equipped with basic administrative and

post-harvest facilities is constructed upfront by NFA for farmer organizations
who commit to sell to the Agency an agreed volume of their seasonal produce.
The FO’s payment for the facility shall be made over 5 to 15 years basically
out of the CDIF granted by NFA.

VII. Municipal Level Grains Center (MLGC)

A 2,500-bag capacity warehouse with a solar drying pavement to serve as

temporary warehouse with solar drying pavement to serve as temporary depot
and trading center for the FO’s produce.
VIII. Philippine Grains Standardization program (PGSP)

A multi-sectoral effort spearheaded by the NFA to implement the National

Grains Standards throughout the country through contnuing advocacy
campaign, particularly among grains farmers, millers, grains businessmen and
consumers, on grains quality, labellin, weighing and packaging.

IX. Guaranteed Quality Rice Marketing Program (GQRMP)

Consumers are assured of a better quality in their rice purchase through the
GQRMP, which aims to eliminate off grade quality stocks in storage and
subsequently during issuances thereby providing good quality rice to all
stakeholders. The nationwide advocacy of the program is strictly undertaken
and sustained not only through the use of posters, certificates and stamp/seal
of quality acceptance but also through strict monitoring of Quality Assurance
Team through sampling and laboratory analysis

X. Rice Fortification

Fortification is the process whereby vitamins and/or minerals are added to

foods to compensate for the inadequacies in Filipino diet. The Rice Iron
Fortification Program has been carried out in order to protect and promote the
right to health and instill health consciousness among the people. Staple food
such as rice shall be fortified in accordance with standards set by the
Department of Health (DOH) through Bureau of Food and Drugs (BFAD) as
the lead implementing agency and shall be assisted by NFA in the monitoring
and review of the program.

We will keep you posted on further development. More Power!

Very Truly yours,

ARTURO V. FIGUEROA
Provincial Manager .