The DA strictly followed and continue to follow the government procurement protocol.

The “approved budget for the contract” or ABC was P1,000/bag, as submitted by the end-user, the DA Field Operations Service.

The ABC was lower than the average retail prices of urea, based on survey by the DA’s Fertilizer and Pesticide Authority (FPA), ranging from P1,043 to P1,062, from March to May 2020; and even cheaper than the average price of P1,140 in December 2019, according to the Philippine Statistics Authority.

The invitation to bid for the supply and delivery of 5,691,477 bags with an ABC of P5,691,477,000, was initially posted at PhilGEPS on April 28, 2020. It was again posted at the DA website on April 30, May 14, and finally on May 28, 2020.

We have initially procured a total of 1,811,090 bags of urea fertilizer at a price lower than the national average retail prices of P1,035.60 for April 27 to May 1; P1,037.53 for May 4 to 8; and P1,040.68 for May 11 to 15.

Such prices were a lot cheaper compared to previous purchases of more than P1,300 per 50-kilo bag of urea fertilizer.

The DA-BAC issued the Notices to Award and Contract to La Filipina Uy Gongco Corp. and Atlas Fertilizer Corp. for the four lots out of the original 16 lots under the urea fertilizer procurement project:

• La Filipina – 97,615 bags at P990/bag (for Region 4A); 694,904 bags at P995/bag (Region 6), and 911,073 bags at P995/bag (Region 3); and
• Atlas – 107,498 bags at P900/bag (Region 7).

Accordingly, the other bidders were disqualified as they were not able to show that they had the technical, legal and financial capability to deliver the goods, execute the works and perform the services to address the emergency procurement of urea fertilizers.

The minimum winning bid price of P900 per 50-kg was P40 to P50 higher than the prices quoted by farmers in their complaint, at P860/bag of 50 kg in Nueva Ecija and P850/bag in Tarlac. They failed to consider that the contract price includes the cost of fertilizer, transportation cost, incidental services, and applicable taxes.

Further, the end-user or the DA Field Operations Service requires the winning supplier to deliver and distribute the urea fertilizers to different municipalities covered under the Rice Resiliency Project.

The DA-FOS submitted to the DA-BAC a revised grouping of bid lots from the previous 12 to 26. The invitation to bid for the 26 lots was posted on May 28, 2020 at PhilGEPS and DA website.

Currently, there is an on-going procurement process for the remaining 12 lots. After a thorough review of the Terms of Reference, the End-user regrouped these 12 lots to 26 lots to ensure wider participation of fertilizer distributors. The respective bidding for the 26 lots are ongoing.

A pre-bid conference was held on June 5, 2020, participated by representatives of 16 companies.

In the spirit of transparency, the DA has fully disclosed all information that the public should know about the matter.
We encourage feedback through the DA Facebook page and hotline number 1381. ###