Farmers seek floor price as palay sells for just P7 per kilo

Ralf Rivas

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Farmers seek floor price as palay sells for just P7 per kilo

Producing palay in the Philippines costs around P12 per kilo, but some farmers say they are forced to sell their harvest at P7 just to compete with imported rice

MANILA, Philippines – Farmers appealed to Congress to set a floor price for palay or unhusked rice, as its farmgate prices have plummeted to much lower than production costs.

In a briefing on the impact of the rice tariffication law at the House of Representatives on Monday, September 2, farmers’ groups said farmgate prices of palay can go as low as P7 per kilo, much lower than the cost to produce it at over P12.

“Talong-talo ang mga magsasaka natin. Hindi ito kasalanan ng Department of Agriculture (DA) o National Food Authority (NFA), dahil ito sa rice liberalization,” said Ignacio Ortiz of the Alyansa ng Magbubukid sa Gitnang Luzon.

(Farmers are really the losers here. This is not the fault of the Department of Agriculture or the National Food Authority, this is because of rice liberalization.)

Ortiz said farmgate prices in Pampanga can go as low as P9 to P12 per kilo, while it’s P7 in Bataan.

The farmers said there are too many cheap rice imports in the market because of rice tariffication, and retailers no longer want to buy from local producers. (READ: Butterfly effect: How rice tariffication bill affects everyone)

However, NFA Administrator Judy Dansal rejected the farmers’ claims, citing data from the Philippine Statistics Authority that prices are at around P16 to P17 per kilo. The cheapest they bought from farmers was P13, she said, because of the high moisture content.

Nueva Ecija 1st District Representative Estrellita Suansing sided with the farmers and invited Dansal to personally visit her province to check out the prices there.

Because of the low selling price, farmers proposed that the government implement a floor price, which would set a limit to how low palay prices can go down. Some groups suggested a floor price that would match the production cost of around P12, while others proposed a lower P10 per kilo.

There is no mention of a floor price in the rice tariffication law. Other measures related to the pricing of goods may also have to be amended.

“It sounds good, that is protection, but I will have to defer to the ones that proposed the measure as to the details,” Agriculture Undersecretary Ariel Cayanan said.

Aside from the floor price, farmers are also asking for the faster disbursement of cash assistance and better implementation of rice programs, which are specified in the law. –

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Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.