THIRTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session 
INTRODUCED BY SEN. MANNY VILLAR 
EXPLANATORYNOTE 
Rice and corn are traditionally the most important commodities in the country. 
They are the staple food for millions of Filipinos. The scarcity or a slight increase in the 
prices of these grains has significant economic effects in the poor sector of the society. 
In this regard, the major thrust and direction of the government is geared to 
achieve food sufficiency and stabililization of the supply and prices of staple food. The 
necessity for government intercession occurs during the harvest season where prices 
decrease and in the lean months where it increases. However, the cost of attaining said 
goal requires a significant amount which necessitates effective and efficient 
management or resources. 
The National Food Authority (NFA) is the government agency mandated to insure 
food security in times of calamitieslemergencies and stabilization of supply and price of 
grains. This is achieved by its procurement operations where the agency procures and 
stocks significant volumes of grains in preparation for price fluctuations in the market. 
This bill seeks to appropriate P5 billion pesos for a "Grains Price Stabilization 
Fund intended to remedy the present situation and to assure the small farmers of a 
reasonable price for their produce and sustain NFA procurement operations and 
logistical support which includes appropriate infrastructure build-up like primary post- 
harvest facilities. Eventually, the facilities shall be turned-over to small farmer 
cooperatives. 
The early passage of this bill is earnestly solicited. 
MANNY VILLAR 


THIRTEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Second Regular Session 
SENATE 
S. No. 
q q t q 
INTRODUCED BY SEN. MANNY VILLAR 
AN ACT 
CREATING THE GRAINS PRICE STABILIZATION FUND OF THE NATIONAL 
FOOD AUTHORITY FOR ITS FOOD SECURITY AND STABILIZATION 
PROGRAM, 
PROVIDING 
FUNDS 
THEREFORE 
AND 
FOR 
OTHER 
PURPOSES 
BeJenacted by the Senate and House of Representatives of the 
Philippines in congress assembled: 
SECTION 1. Title.- This Act shall be known as the “Grains Price 
stabilization Fund Act“. 
SECTION 2. Definition of Terms.- As used in this Act, the following terms 
shall be construed to mean as follows: 
1. “Rice” shall mean dehusked or unhusked kernel coming from a plant 
known in Botany as Oryes Sativa L. and/or all its grains, varieties and 
sub-varieties belonging to the family Gramineae; 
2. “Corn or maize” shall mean and include corn or the cob, the shelled 
(corngrains) or the ground (corngrits) kernel coming from a plant 
known in Botany as Zea Maya L. as well as all its strains, varieties, 
varieties and sub-varieties belonging to the family Gramineae; 
3. “Grains” shall mean dehusked, milled or unmilled seeds or fruits of 
various food plants, more specifically the cereal; 
4. “Small farmers” refers to natural persons dependent on small scale 
subsistence farming as their primary source of income and whose sale, 
barter or exchange of agricultural products do not exceed a gross 
value of One Hundred Eighty Thousand Pesos (P180,OOO.OO) per 
annum based on the 1992 constant prices (as defined in Republic Act 
No. 7606); and 
5. “Agricultural commodities” shall mean those products or those goods 
such as palay and rice, corn, wheat, fish and marine products, 
livestock, poultry, vegetables and fruits in their raw or basic form. 


SECTION 3. Declaration of Policy.- It shall be the policy of the State to 
promote the growth and development of the grains farmers. 
Recognizing that rice and corn is the staple food of most if not all Filipinos, 
continued growth and productivity of the grains industry is critical in assuring the 
food security and growth for small grain farmers who comprise the majority of 
producers to be provided with reasonable profits and livelihood. 
Pursuant to this policy, the state shall provide a mechanism to protect 
small grains farmers from severe price fluctuations. Their productivity shall be 
rewarded by assuring a reasonable price even during the main harvest season. 
SECTION 4. Grain Price Stabilization Fund.- To implement the policy 
enunciated in this Act, there is hereby established the Grain Price Stabilization 
Fund hereinafter referred to as the Fund. The Fund shall be used by the NFA for 
its rice and corn procurement operations from small farmers. It can also be used 
by the NFA for the logistical support requirement of said activity. The Fund shall 
be in the amount of P5 Billion Pesos shall be deposited in a government financial 
institution. Interest earned shall accrue to the Fund: Provided however, that the 
National Government shall reimburse the trading losses incurred by the NFA in 
its yearly marketing operations. 
SECTION 5. Funding.- All taxes and tariff collected from the importation of 
agricultural commodities in their new materials in their raw or basic form such as 
but not limited to wheat, rice, corn and savings from debt service shall form part 
of the Fund. The National Government shall remit to the Fund all collections from 
the above source until the Fund shall have reached P5 Billion Pesos. 
SECTION 6. Implementing Rules of this Act.- Within sixty (60) days from 
the effectivity of this Act, the NFA, in consultation with the Department of 
Finance, shall issue the necessary rules and regulations to implement this Act. 
SECTION 7. Repealing Clause.- All acts, executive orders, rules and 
regulations and other issuances or parts thereof which are inconsistent with the 
provisions on this Act hereby repealed accordingly. 
SECTION 8. Separability Clause.- If any provision of this Act shall be held 
unconstitutional or invalid, the other provisions not otherwise affected shall 
remain in full force and effect. 
SECTION 9. Effectivity.- 
This Act shall take effect fifteen (15) days 
following its publication in the Official Gazette or in at least two (2) newspapers of 
general circulation. 
Approved.