DA centralized bidding brought urea price down to benefit farmers

June 26, 2020
Urea distribution in Calabarzon

FILIPINO farmers stand to benefit from lower prices of urea fertilizer following a centralized bidding conducted by the Department of Agriculture (DA) last April.

In a virtual press briefing Thursday, DA officials said the price of urea, a widely used fertilizer in the Philippines, dropped below P1,000 per 50-kg bag following DA’s successful centralized bidding. Previously, prices of urea were hovering at more than P1,100 per 50-kg bag.

"The downward trend of urea prices shows that we’re on the right track in centralizing the bidding process, thus providing our farmers nationwide with affordable and reasonably-priced fertilizers," said agriculture secretary William Dar.

The urea fertilizers will be given free to farmers participating in DA's Rice Resiliency Project (RRP) under a "buy two, take two" scheme for those who use certified inbred seeds and "buy two, take three" for hybrid users, Dar said.

Debunking claims of alleged overpricing, DA assistant Secretary Noel Reyes stressed that the Approved Budget for the Contract (ABC) for the fertilizer bidding of the DA Rice Program was based on the month-long price trends collated by the Fertilizer and Pesticide Authority (FPA) and the Philippine Statistics Authority (PSA).

Based on FPA data, the national average price of urea fertilizer from February to April 2020 was P1,051/bag. The same price trend was noted in retail outlets across the Philippines based on copies of actual receipts and invoices presented to media.

After the first and second biddings, 1.8 million bags were awarded to two companies, namely: La Filipina Uy Gongco Corp. and Atlas Fertilizer, offering urea at prices ranging from P900 to P995 per 50-kg bag.

Per delivery schedule set by the DA Rice Program, the winning suppliers will distribute the  fertilizers directly to municipalities covered under the RRP in four lots, corresponding to four regions: Central Luzon, Calabarzon, Western Visayas, and Central Visayas.

Last June 5, Reyes said 14 prospective suppliers attended DA’s pre-bid conference for the next 26 fertilizer lots, but only four submitted bid proposals. Of the four, only three were considered. The fourth bidder was disqualified due to lack of required bid documents.

The DA-BAC expects to complete the evaluation of the three bidders and declare the winners by July 9. The winners must deliver 50 percent of the urea fertilizers per lot, not later than July 15, 2020, and the rest, not later than July 31, 2020. There are still 18 lots up for bidding.

For transparency, the DA’s bidding process is live-streamed via the official DA Facebook page.